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Mandate for
Leadership

The Conservative Promise

Project 2025

PRESIDENTIAL TRANSITION PROJECT

ISBN: 978-0-89195-174-2

Mandate for
Leadership

The Conservative Promise

Foreword by Kevin D. Roberts, PhD
Edited by Paul Dans and Steven Groves

SECTION 1: TAKING THE REINS OF GOVERNMENT ..
ie

Contents

ACKNOWLEDGMENTS... ;
THE PROJECT 2025 ADVISORY BOARD

THE 2025 PRESIDENTIAL TRANSITION PROJECT:
A NOTE ON “PROJECT 2025”

AUTHORS.
CONTRIBUTORS

FOREWORD: A PROMISE TO AMERICA
Kevin D. Roberts, PhD

WHITE HOUSE OFFICE
Rick Dearborn

EXECUTIVE OFFICE OF THE PRESIDENT
OF THE UNITED STATES
Russ Vought

CENTRAL PERSONNEL AGENCIES:
MANAGING THE BUREAUCRACY. -
Donald Devine, Dennis Dean Kirk, and Paul Dans

SECTION 2: THE COMMON DEFENSE

DEPARTMENT OF DEFENSE
Christopher Miller

DEPARTMENT OF HOMELAND SECURITY
Ken Cuccinelli

DEPARTMENT OF STATE.....
Kiron K. Skinner

INTELLIGENCE COMMUNITY
Dustin J. Carmack
MEDIA AGENCIES

U.S. AGENCY FOR GLOBAL MEDIA... eer
Mora Namdar
CORPORATION FOR PUBLIC BROADCASTING ....
Mike Gonzalez

AGENCY FOR INTERNATIONAL DEVELOPMENT
Max Primorac

246

253

SECTION 3: THE GENERAL WELFARE

10. DEPARTMENT OF AGRICULTURE
Daren Bakst

11. DEPARTMENT OF EDUCATION...
Lindsey M. Burke

12. DEPARTMENT OF ENERGY
AND RELATED COMMISSIONS
Bernard L. McNamee

13. ENVIRONMENTAL PROTECTION AGENCY
Mandy M. Gunasekara

14. DEPARTMENT OF HEALTH
AND HUMAN SERVICES
Roger Severino

15. DEPARTMENT OF HOUSING
AND URBAN DEVELOPMENT
Benjamin S. Carson, Sr., MD

16. DEPARTMENT OF THE INTERIOR
William Perry Pendley

17. DEPARTMENT OF JUSTICE
Gene Hamilton

18. DEPARTMENT OF LABOR
AND RELATED AGENCIES ..
Jonathan Berry

19. DEPARTMENT OF TRANSPORTATION.
Diana Furchtgott-Roth

20. DEPARTMENT OF VETERANS AFFAIRS
Brooks D. Tucker

283
289

319

363

417

449

545

641

SECTION 4: THE ECONOMY

21.

22.

23.

24.

25.

26.

DEPARTMENT OF COMMERCE
Thomas F. Gilman

DEPARTMENT OF THE TREASURY
William L. Walton, Stephen Moore, and David R. Burton
EXPORT-IMPORT BANK

THE EXPORT-IMPORT BANK SHOULD BE ABOLISHED

Veronique de Rugy

THE CASE FOR THE EXPORT-IMPORT BANK

Jennifer Hazelton

FEDERAL RESERVE...
Paul Winfree

SMALL BUSINESS ADMINISTRATION
Karen Kerrigan
TRADE

THE CASE FOR FAIR TRADE...
Peter Navarro

THE CASE FOR FREE TRADE.....
Kent Lassman

SECTION 5: INDEPENDENT REGULATORY AGENCIES

27.

28.

29.

30.

FINANCIAL REGULATORY AGENCIES
SECURITIES AND EXCHANGE COMMISSION
AND RELATED AGENCIES
David R. Burton
CONSUMER FINANCIAL PROTECTION BUREAU ....
Robert Bowes

FEDERAL COMMUNICATIONS COMMISSION
Brendan Carr

FEDERAL ELECTION COMMISSION
Hans A. von Spakovsky

FEDERAL TRADE COMMISSION ...
Adam Candeub

ONWARD!
Edwin J. Feulner

657
663

691

717
717

724

745

Acknowledgments

his work, Mandate for Leadership 2025: The Conservative Promise, is a col-

lective effort of hundreds of volunteers who have banded together in the

spirit of advancing positive change for America. Our work is by no means
the comprehensive compendium of conservative policies, nor is our group the
exclusive cadre of conservative thinkers. The ideas expressed in this volume are
not necessarily shared by all. What unites us is the drive to make our country better.

First and foremost, we thank the chapter authors and contributors who gave
so freely of their time in service of their country.

We were particularly grateful to have the help of dedicated members of The
Heritage Foundation’s management and policy teams. Executive Vice President
Derrick Morgan, Chief of Staff Wesley Coopersmith, Associate Director of Project
2025 Spencer Chretien, and Thomas A. Roe Institute for Economic Policy Studies
Director Paul Ray devoted a significant amount of their valuable time to reviewing
and editing the lengthy manuscript and provided expert advice and insight.

The job of transforming the work of dozens of authors and hundreds of
contributors into a cohesive manuscript fell upon Heritage’s formidable team of
editors led by Director of Research Editors Therese Pennefather, Senior Editor
William T. Poole, Marla Hess, Jessica Lowther, Karina Rollins, and Kathleen
Scaturro, without whose tireless efforts you would not be reading these words.
The talented work of Data Graphics Services Manager John Fleming, Manager of
Web Development and Print Projects Jay Simon, Director of Marketing Elizabeth
Fender, Senior Graphic Designer Grace Desandro, and Senior Designer Melissa
Bluey came together to bring the volume to life. We also thank the dedicated junior
staff who provided immeasurable assistance, especially Jordan Embree, Sarah
Calvis, and Jonathan Moy.

Most important, we are grateful to the leadership, supporters, and donors of
each of the Project 2025 advisory board member organizations and those of The
Heritage Foundation, without whom Project 2025 would not be possible.

Thank you.

Paul Dans & Steven Groves

—ix—

The Project 2025
Advisory Board

Alabama Policy Institute

Alliance Defending Freedom

American Compass

The American Conservative

America First Legal Foundation
American Accountability Foundation
American Center for Law and Justice
American Cornerstone Institute
American Council of Trustees and Alumni
American Legislative Exchange Council
The American Main Street Initiative
American Moment

American Principles Project

Center for Equal Opportunity

Center for Family and Human Rights
Center for Immigration Studies

Center for Renewing America
Claremont Institute

Coalition for a Prosperous America
Competitive Enterprise Institute
Conservative Partnership Institute
Concerned Women for America
Defense of Freedom Institute

Ethics and Public Policy Center

Family Policy Alliance

Family Research Council

First Liberty Institute

Forge Leadership Network

Foundation for Defense of Democracies
Foundation for Government Accountability
FreedomWorks

The Heritage Foundation

Hillsdale College

Honest Elections Project

—xi-—

Mandate for Leadership: The Conservative Promise

Independent Women’s Forum
Institute for the American Worker
Institute for Energy Research
Institute for Women’s Health
Intercollegiate Studies Institute
James Madison Institute

Keystone Policy

The Leadership Institute

Liberty University

National Association of Scholars
National Center for Public Policy Research
Pacific Research Institute

Patrick Henry College

Personnel Policy Operations

Recovery for America Now Foundation
1792 Exchange

Susan B. Anthony Pro-Life America
Texas Public Policy Foundation

Teneo Network

Young America’s Foundation

— xii —

The 2025 Presidential
Transition Project

A NOTE ON
“PROJECT 2025”

e want you! The 2025 Presidential Transition Project is the conservative
movement’s unified effort to be ready for the next conservative
Administration to govern at 12:00 noon, January 20, 2025. Welcome
to the mission. By opening this book, you are now a part of it. Indeed, one set
of eyes reading these passages will be those of the 47th President of the United
States, and we hope every other reader will join in making the incoming Admin-
istration a success.

History teaches that a President’s power to implement an agendais at its apex during
the Administration’s opening days. To execute requires a well-conceived, coordinated,
unified plan and a trained and committed cadre of personnel to implement it. In recent
election cycles, presidential candidates normally began transition planning in the late
spring of election year or even after the party’s nomination was secured. That is too late.
The federal government’s complexity and growth advance at a seemingly logarithmic
rate every four years. For conservatives to have a fighting chance to take on the Adminis-
trative State and reform our federal government, the work must start now. The entirety
of this effort is to support the next conservative President, whoever he or she may be.

In the winter of 1980, the fledging Heritage Foundation handed to President-elect
Ronald Reagan the inaugural Mandate for Leadership. This collective work by conser-
vative thought leaders and former government hands—most of whom were not part of
Heritage—set out policy prescriptions, agency by agency for the incoming President.
The book literally put the conservative movement and Reagan on the same page, and
the revolution that followed might never have been, save for this band of committed and
volunteer activists. With this volume, we have gone back to the future—and then some.

— xiii —

Mandate for Leadership: The Conservative Promise

It’s not 1980. In 2023, the game has changed. The long march of cultural Marxism
through our institutions has come to pass. The federal government is a behemoth,
weaponized against American citizens and conservative values, with freedom and
liberty under siege as never before. The task at hand to reverse this tide and restore
our Republic to its original moorings is too great for any one conservative policy shop
to spearhead. It requires the collective action of our movement. With the quickening
approach of January 2025, we have two years and one chance to get it right.

Project 2025 is more than 50 (and growing) of the nation’s leading conservative
organizations joining forces to prepare and seize the day. The axiom goes “person-
nel is policy,” and we need a new generation of Americans to answer the call and
come to serve. This book is functionally an invitation for you the reader—Mr. Smith,
Mrs. Smith, and Ms. Smith—to come to Washington or support those who can. Our
goal is to assemble an army of aligned, vetted, trained, and prepared conservatives
to go to work on Day One to deconstruct the Administrative State.

The project is built on four pillars.

e = Pillar I—this volume—puts in one place a consensus view of how major
federal agencies must be governed and where disagreement exists brackets
out these differences for the next President to choose a path.

e Pillar IT is a personnel database that allows candidates to build their own
professional profiles and our coalition members to review and voice their
recommendations. These recommendations will then be collated and shared
with the President-elect’s team, greatly streamlining the appointment process.

e Pillar IIT is the Presidential Administration Academy, an online
educational system taught by experts from our coalition. For the newcomer,
this will explain how the government functions and how to function in
government. For the experienced, we will host in-person seminars with
advanced training and set the bar for what is expected of senior leadership.

e In Pillar [TV—the Playbook—we are forming agency teams and drafting tran-
sition plans to move out upon the President’s utterance of “so help me God.”

As Americans living at the approach of our nation’s 250th birthday, we have been
given much. As conservatives, we are as much required to steward this precious
heritage for the next generation. On behalf of our coalition partners, we thank you
and invite you to come join with us at project2025.org.

Paul Dans
Director, Project 2025

— xiv —

Authors

Daren Bakst is Deputy Director, Center for Energy and Environment, and Senior

Fellow at the Competitive Enterprise Institute (CED. Before joining CEI, Daren

was a Senior Research Fellow at The Heritage Foundation, where he played a lead-
ing role in the launch of the organization’s new energy and environmental center.
For a decade, he led Heritage’s food and agricultural policy work, and he edited and

co-authored Heritage’s book Farms and Free Enterprise. He has testified numerous

times before Congress, has appeared frequently on media outlets, and has played

leadership roles in such organizations such as the Federalist Society, American

Agricultural Law Association, and Food and Drug Law Institute (serving on the

Food and Drug Law Journat’s editorial advisory board).

Jonathan Berry is managing partner at Boyden Gray & Associates PLLC. He

served as acting Assistant Secretary for Policy at the U.S. Department of Labor,
overseeing all aspects of rulemaking and policy development. At the U.S. Depart-
ment of Justice, he assisted with the development of regulatory policy and with

the nominations of Justice Neil Gorsuch and dozens of other judges. He previ-
ously served as Chief Counsel for the Trump transition and earlier clerked for
Associate Justice Samuel Alito and Judge Jerry Smith of the U.S. Court of Appeals

for the Fifth Circuit. He is a graduate of Yale College and Columbia University
School of Law.

Lindsey M. Burke is Director of the Center for Education Policy at The Heritage
Foundation. Burke served on Virginia Governor Glenn Youngkin’s transition
steering committee and landing team for education. She serves on the Board
of Visitors for George Mason University, the board of the Educational Free-
dom Institute, and the advisory board of the Independent Women’s Forum’s
Education Freedom Center. Dr. Burke’s research has been published in such
journals as Social Science Quarterly, Educational Research and Evaluation, and
Research in Educational Administration and Leadership. She holds a BA from
Hollins University, an MA from the University of Virginia, and a PhD from George
Mason University.

David R. Burton is Senior Fellow in Economic Policy in the Thomas A. Roe
Institute for Economic Policy Studies at The Heritage Foundation. He focuses
on securities regulation, tax policy, business law, entrepreneurship, administra-
tive law, financial privacy, the U.S. Department of Commerce, corporate welfare,

Mandate for Leadership: The Conservative Promise

international investment, international information sharing, the U.S. economic
relationship with China, and climate-related financial risk. Previously, Burton was
General Counsel at the National Small Business Association; a partner in the Argus
Group; Vice President, Finance, and General Counsel for New England Machinery;
and manager of the U.S. Chamber of Commerce’s Tax Policy Center. He holds a JD
from the University of Maryland School of Law and a BA in Economics from the
University of Chicago.

Adam Candeub is a professor of law at Michigan State University. His scholarly

research focuses on telecommunication, antitrust, and Internet issues. He served

as acting Assistant Secretary of Commerce and Deputy Associate Attorney Gen-
eral at the Justice Department during the Trump Administration. He received his

BA magna cum laude from Yale University and his JD magna cum laude from the

University of Pennsylvania Law School.

Dustin J. Carmack is Research Fellow for Cybersecurity, Intelligence, and Emerg-
ing Technologies in the Border Security and Immigration Center at The Heritage

Foundation. Previously, he served in the Intelligence Community as Chief of Staff
to the Director of National Intelligence, John Ratcliffe. In Congress, he served

as Chief of Staff to Congressman John Ratcliffe (TX-04) and Congressman Ron

DeSantis (FL-06). Mr. Carmack studied at Truman State University in Missouri

and Tel Aviv University in Israel.

Brendan Carr has nearly 20 years of private-sector and public-sector experience
in communications and tech policy. He currently serves as the senior Republican
on the Federal Communications Commission. Prior to this role, Carr served as
the Federal Communication Commission’s General Counsel. Earlier, he worked
as an attorney at Wiley Rein LLP. Previously, he clerked on the U.S. Court of
Appeals for the Fourth Circuit. After graduating from Georgetown University,
he earned his JD magna cum laude from the Catholic University of America’s
Columbus School of Law where he served as an editor of the Catholic Univer-
sity Law Review.

Benjamin S. Carson, Sr., MD, is Founder and Chairman of the American Corner-
stone Institute and previously served as the 17th Secretary of the U.S. Department

of Housing and Urban Development. Born in Detroit to a single mother with a

third-grade education, Dr. Carson was raised to love reading and education. He

attended Yale and earned his MD from the University of Michigan Medical School.
For nearly 30 years, Dr. Carson served as Director of Pediatric Neurosurgery at

the Johns Hopkins Children’s Center, where he performed the first separation of
twins conjoined at the back of the head.

— xvi —

2025 Presidential Transition Project

Ken Cuccinelli served as Acting Director of U.S. Citizenship and Immigration
Services in 2019 and then, from November 2019 through the end of the Trump
Administration, as Acting Deputy Secretary for the U.S. Department of Homeland
Security. During his tenure as Acting Deputy Secretary, Ken also served as the Chief
Regulatory Officer for the Department of Homeland Security. He also has served
the Commonwealth of Virginia, first as a state senator and then as Virginia’s 46th
Attorney General.

Rick Dearborn served as Deputy Chief of Staff for President Donald Trump and

was responsible for the day-to-day operations of five separate departments of the

Executive Office of the President. He also served as Executive Director of the 2016

President-elect Donald Trump transition team. Before that, Rick served in several

roles, including as Chief of Staff, in the office of then-U.S. Senator Jeff Sessions

(R-AL) for nearly two decades. Between his two tours in Senator Sessions’ office,
he was appointed by President George W. Bush as Assistant Secretary of Energy for

Congressional Affairs. Earlier in his career, Rick worked for the National Repub-
lican Senatorial Committee, the Senate Republican Conference, and the Senate

Steering Committee. He graduated from the University of Oklahoma with a BA in
Public Administration and a minor in economics.

Veronique de Rugy is the George Gibbs Chair in Political Economy and Senior

Research Fellow at the Mercatus Center at George Mason University and a nation-
ally syndicated columnist. Her primary research interests include the U.S. economy,
the federal budget, taxation, tax competition, and cronyism. De Rugy is the author

of a weekly opinion column for the Creators Syndicate, writes regular columns

for Reason magazine, and blogs about economics at National Review Online’s The

Corner. She received her MA in economics from the Paris Dauphine University and

her PhD in economics from the Panthéon-Sorbonne University.

Donald Devine is Senior Scholar at The Fund for American Studies in Washington,
DC. He was President Ronald Reagan’s first-term Office of Personnel Management
Director when The Washington Post labeled him “Reagan’s Terrible Swift Sword of
the Civil Service” for cutting bureaucracy and reducing spending by billions of dol-
lars. He was a professor at the University of Maryland and Bellevue University and
is acolumnist and author of 10 books, including his recent The Enduring Tension.

Diana Furchtgott-Roth, an Oxford-educated economist, directs the Center for
Energy, Climate, and Environment at The Heritage Foundation and is adjunct
professor of economics at George Washington University. Diana served as Deputy
Assistant Secretary for Research and Technology at the U.S. Department of Trans-
portation, where she directed the Department’s $1.2 billion research budget; the

— xvii —

Mandate for Leadership: The Conservative Promise

Office of Positioning, Navigation and Timing and Spectrum Management; and the
University Transportation Center program. Diana worked in senior roles in the
White House under Presidents Ronald Reagan, George H.W. Bush, and George W.
Bush, where she was Chief of Staff of the Council of Economic Advisers.

Thomas F. Gilman served as Assistant Secretary of Commerce for Administration

and Chief Financial Officer of the U.S. Department of Commerce in the Trump

Administration. Currently, he is a Director of ACLJ Action and Chairman of Torn-
gat Metals. Tom is the former CEO of Chrysler Financial and has had a 40-plus year
career as a senior executive and entrepreneur in the global automotive industry,
including roles at Chrysler Corporation, Cerberus Capital Management, Asbury
Automotive Group, TD Auto Finance, and Automotive Capital Services. He holds

a BS in finance from Villanova University.

Mandy M. Gunasekara of Oxford, Mississippi, is a principal at Section VII Strat-
egies, a Senior Policy Analyst at the Independent Women’s Forum, and Visiting
Fellow in the Center for Energy, Climate, and Environment at The Heritage Foun-
dation. During the Trump Administration, Mandy served as the Chief of Staff at
the U.S. Environmental Protection Agency as well as Principal Deputy Assistant
Administrator for the Office of Air and Radiation. She previously served in numer-
ous roles at the U.S. House of Representatives and U.S. Senate, including as Majority
Counsel for the Senate Environment and Public Works Committee under Chair-
man Jim Inhofe. She received her BA from Mississippi College and her JD from
the University of Mississippi School of Law.

Gene Hamilton is Vice-President and General Counsel of America First Legal Foun-
dation. Gene served as Counselor to the Attorney General at the U.S. Department of
Justice; Senior Counselor to the Secretary of Homeland Security; General Counsel on

the Senate Committee on the Judiciary; Assistant Chief Counsel at U.S. Immigration

and Customs Enforcement; and as an Attorney Advisor in the Secretary’s Honors

Program for Attorneys at the Department of Homeland Security. Gene graduated

from the Washington and Lee University School of Law magna cum laude and Order

of the Coif and has a BA in international affairs from the University of Georgia.

Jennifer Hazelton has worked as a senior strategic consultant for the Depart-
ment of Defense in Industrial Base Policy and has held senior positions at USAID,
the Export-Import Bank of the United States, and the State Department. She was
also acommunications director in the U.S. Congress and worked as an award-win-
ning journalist for CNN and Fox News Channel. Hazelton holds an MA in business
administration from Emory University and earned her BA from the Univer-
sity of Georgia.

— xviii —

2025 Presidential Transition Project

Karen Kerrigan is President and CEO of the Small Business & Entrepreneurship
Council and has helped to strengthen U.S. entrepreneurship and global business
growth for 28 years. She has provided counsel across the globe via training missions
focused on entrepreneurial development, effective advocacy, policy formation,
and implementation. Karen testifies regularly before Congress and has served on
numerous federal advisory boards representing the interests of entrepreneurs
and small businesses.

Dennis Dean Kirk is Associate Director for Personnel Policy with the 2025 Pres-
idential Transition Project at The Heritage Foundation. Born and raised in Kansas,
he graduated with honors from Northern Arizona University and Washburn Uni-
versity Law School. Dennis has over 45 years of experience in private law and

public federal government counsel services. He served in President George Bush’s

Administration in the U.S. Army’s Office of General Counsel and later as Associate

General Counsel for Strategic Integration and Business Transformation, where

he was recognized with the Exceptional Civilian and Meritorious Civilian Service

Awards and other awards. During the Trump Administration, Dennis served in

senior positions at the Office of Personnel Management and was nominated by
President Trump to be Chairman of the Merit Systems Protection Board.

Kent Lassman is President and CEO of the Competitive Enterprise Institute.
Educated at the Catholic University of America and North Carolina State Univer-
sity, he has written on telecommunications, privacy, environmental, antitrust, and
consumer protection regulation as well as trade policy and the design of regulatory
systems. Kent’s policy research and advocacy have taken him to 45 state capitals,
more than a dozen countries, and deep into the heart of the federal regulatory state.

Bernard L. McNamee is an energy and regulatory attorney with a major law
firm and was formerly a member of the Federal Energy Regulatory Commission.
He is also the Street Distinguished Visiting Professor of Law at the Appalachian
School of Law. In addition to serving as a Federal Energy Regulatory Commissioner,
McNamee has served in various senior policy and legal positions throughout his
career, including at the U.S. Department of Energy, for U.S. Senator Ted Cruz, and
for Virginia Governor George Allen. McNamee also served four attorneys general
in two states (Virginia and Texas).

Christopher Miller served in several positions during the Trump Administration,
including as Acting U.S. Secretary of Defense, Director of the National Counter-
terrorism Center, Deputy Assistant Secretary of Defense for Special Operations
and Combating Terrorism, and Senior Director for Counterterrorism and Trans-
national Threats at the National Security Council. Before his civilian service in the

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Mandate for Leadership: The Conservative Promise

Department of Defense, Miller was an Army Green Beret in the 5th Special Forces
Group with multiple combat tours in Iraq and Afghanistan, achieving the rank of
colonel. Miller earned a BA from George Washington University and an MA from
the Naval War College. He also graduated from the College of Naval Command and
Staff and the Army War College.

Stephen Moore is a conservative economist and author. He is currently a senior
economist at FreedomWorks, a Distinguished Fellow at The Heritage Foundation,
and a Fox News analyst. From 2005 to 2014, Moore served as the senior economics
writer for The Wall Street Journal editorial page and as amember of the Journals
editorial board. He still contributes regularly to the Journal's editorial page. He is
a frequent lecturer to business investment and university audiences around the
world on the U.S. economic and political outlook in Washington, DC.

Mora Namdar is an attorney and Senior Fellow at the American Foreign Policy
Council. She speaks fluent Farsi and is an expert on U.S. national security, human
rights, global communications, the Middle East, and international law. Mora served
as senior advisor for critical issues at the U.S. State Department and was appointed
by President Donald Trump to perform the duties of the Assistant Secretary of
State for Consular Affairs. She also served as Vice President of Legal, Compliance,
and Risk at the U.S. Agency for Global Media.

Peter Navarro holds a PhD in economics from Harvard and was one of only three
senior White House officials to serve with Donald Trump from the 2016 campaign
to the end of the President’s first term. He was the West Wing’s chief China hawk
and trade czar and served as Director of the Office of Trade and Manufacturing
Policy and Defense Production Act Policy Coordinator. His books include The
Coming China Wars (2006); Death by China (2011); Crouching Tiger (2015); and his
White House memoirs Jn Trump Time (2021) and Taking Back Trump’s America
(2022). His top-rated Taking Back Trump’s America podcast appears on Apple
Podcasts and Google Podcasts.

William Perry Pendley was born in Cheyenne, Wyoming. He earned a BA and

an MA from George Washington University, was a U.S. Marine Corps captain, and

earned his JD from the University of Wyoming College of Law. He was an attorney

on Capitol Hill, a senior official for President Ronald Reagan, and leader of the

Bureau of Land Management for President Donald Trump. For 30 years, he was

president of Mountain States Legal Foundation where he argued and won cases

before the Supreme Court of the United States. He authored five books, includ-
ing Sagebrush Rebel: Reagan’s Battle with Environmental Extremists and Why It
Matters Today.

2025 Presidential Transition Project

Max Primorac is Director of the Douglas and Sarah Allison Center for Foreign
Policy Studies at The Heritage Foundation. He was acting Chief Operating Officer
and Assistant to the Administrator, Bureau for Humanitarian Assistance, at the
U.S. Agency for International Development. Previously he was deputy director of
Iraq’s reconstruction program at the U.S. Department of State anda senior adviser
in the Office of the Secretary. Max was educated at Franklin and Marshall College
and the University of Chicago.

Roger Severino is Vice President of Domestic Policy at The Heritage Founda-
tion. As director of the Office for Civil Rights at the U.S. Department of Health and
Human Services (HHS) from 2017 to 2021, he led a team of more than 250 staff
enforcing civil rights, conscience, and health information privacy laws. Roger sub-
sequently founded the HHS Accountability Project at the Ethics & Public Policy
Center. He holds a JD from Harvard Law School, an MA in public policy from
Carnegie Mellon University, and a BA from the University of Southern California.

Kiron K. Skinner is President and CEO of the Foundation for America and the
World, Taube Professor of International Relations and Politics at Pepperdine
University’s School of Public Policy, W. Glenn Campbell Research Fellow at the
Hoover Institution, and a Visiting Fellow and Senior Advisor at The Heritage
Foundation. Skinner served as Director of Policy Planning and Senior Advisor at
the U.S. Department of State from 2018 to 2019 and was a member of the Defense
Business Board at the U.S. Department of Defense in 2020. Skinner holds an MA
and a PhD in political science from Harvard University and undergraduate degrees
from Spelman College and Sacramento City College.

Brooks D. Tucker served in the U.S. Department of Veterans Affairs as Assis-
tant Secretary for Congressional and Legislative Affairs from 2017 to 2021 and
as Acting Chief of Staff from 2020 to 2021. He helped to craft the policy frame-
work for President-elect Trump’s transition team and served as the Senior Policy
Adviser for National Security and Veterans Affairs to Senator Richard Burr from
2010 to 2015. A retired Marine lieutenant colonel, Brooks served in Afghanistan,
Iraq, North Africa, the Caucasus, and the Western Pacific. He is a graduate of the
University of Maryland, Marine Corps Infantry Officer Course, and Marine Corps
Command and Staff College and holds a Certificate in Legislative Studies from
Georgetown University.

Hans A. von Spakovsky is Senior Legal Fellow and Manager of the Election Law
Reform Initiative in the Edwin Meese Center III Center for Legal and Judicial
Studies at The Heritage Foundation. He is a former member of President Donald
Trump’s Advisory Commission on Election Integrity. From 2006 to 2007, von

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Mandate for Leadership: The Conservative Promise

Spakovsky was a Commissioner on the Federal Election Commission. He served
as career Counsel to the Assistant Attorney General for Civil Rights at the US.
Department of Justice from 2002 to 2005.

Russ Vought is Founder and President of the Center for Renewing America. A
longtime conservative leader on Capitol Hill, Russ served in President Trump’s

Cabinet as Director of the Office of Management and Budget, where he oversaw

the implementation of the presidential budget, key policies on deregulation, and

a landmark effort to eliminate critical race theory and other radical ideologies in

executive agencies. Prior to his White House service, Russ spent nearly two decades

in the broader conservative movement on Capitol Hill, including as Policy Direc-
tor for the House Republican Conference, Executive Director of the Republican

Study Committee, and Legislative Assistant to former U.S. Senator Phil Gramm.
Russ graduated with a BA from Wheaton College and received a JD from George

Washington University Law School.

William L. Walton is Chairman of the Resolute Protector Foundation and host

of The Bill Walton Show. In 2016 and 2017, Mr. Walton served in President-elect

Donald Trump’s transition team as Agency Action Leader for all the federal eco-
nomic agencies. He served as Chairman of the Board and CEO of Allied Capital

Corporation, a $6 billion NYSE-traded private investment firm, from 1997 to 2010.
He is the immediate past President of the Council for National Policy. His extensive

board service includes The Heritage Foundation, American Conservative Union,
American Enterprise Institute, U.S. Chamber of Commerce, National Venture Cap-
ital Association, and Financial Services Roundtable.

Paul Winfree is Distinguished Fellow in Economic Policy and Public Leadership

at The Heritage Foundation. Before rejoining Heritage in 2018, Paul was Deputy

Assistant to the President, Deputy Director of the Domestic Policy Council, and

Director of Budget Policy at the White House. During the 2016 presidential transi-
tion, he led the team responsible for the Office of Management and Budget. He also

has served as a senior staff member for the U.S. Senate Committee on the Budget.
Paul served in both the Biden and Trump Administrations for three terms as the

Chair of the Fulbright Foreign Scholarship Board that oversees the Fulbright pro-
gram and educational exchanges sponsored by the Department of State.

EDITORS

Paul Dans is Director of the 2025 Presidential Transition Project at The Heritage
Foundation, organizing policy and personnel recommendations and training for
appointees in the next presidential Administration. Before joining Heritage, he
served in the Trump Administration as Chief of Staff at the U.S. Office of Personnel

— xxii —

2025 Presidential Transition Project

Management, as OPM’s White House liaison, and as a senior advisor at the U.S.
Department of Housing and Urban Development. Paul has extensive experience
in high-stakes commercial litigation and worked for several large international law
firms in New York City from 1997 to 2012 before founding his own law firm. He is a
graduate of the University of Virginia School of Law and received his graduate and
undergraduate degrees from the Massachusetts Institute of Technology.

Steven Groves is the Margaret Thatcher Fellow in the Margaret Thatcher Center

for Freedom at The Heritage Foundation. Groves served in the Trump Adminis-
tration, first as Ambassador Nikki Haley’s Chief of Staff at the U.S. Mission to the

United Nations. He later joined the White House as Assistant Special Counsel,
representing the White House in the Mueller investigation. Groves also served as

White House Deputy Press Secretary. His prior positions include Senior Counsel

for the U.S. Senate Permanent Subcommittee on Investigations and associate at

Boies, Schiller & Flexner LLP. Groves holds an LLM from Georgetown University

Law Center, a JD from Ohio Northern University’s College of Law, and a BA from

Florida State University.

— xxiii —

Contributors

he contributors listed below generously volunteered their time and effort

to assist the authors in the development and writing of this volume’s 30
chapters. The policy views and reform proposals herein are not an all-inclu-

sive catalogue of conservative ideas for the next President, nor is there unanimity
among the contributors or the organizations with which they are affiliated with

regard to the recommendations.

Mark Albrecht

Chris Anderson, Office of Senator Steve Daines
Jeff Anderson, The American Main Street Initiative
Michael Anton, Hillsdale College

EJ Antoni, The Heritage Foundation

Andrew “Art” Arthur, Center for Immigration Studies
Paul Atkins, Patomak Global Partners

Julie Axelrod, Center for Immigration Studies
James Bacon

James Baehr

Stewart Baker, Steptoe and Johnson LLP

Erik Baptist, Alliance Defending Freedom

Brent Bennett, Texas Public Policy Foundation
John Berlau, Competitive Enterprise Institute
Russell Berman, Hoover Institution

Sanjai Bhagat, University of Colorado Boulder
Stephen Billy, Susan B. Anthony Pro-Life America
Brad Bishop, American Cornerstone Institute
Willis Bixby, WWBX, LLC

Josh Blackman, South Texas College of Law

Jim Blew, Defense of Freedom Institute for Policy Studies
Robert Bortins, Classical Conversations

Rachel Bovard, Conservative Partnership Institute
Robert Bowes

Matt Bowman, Alliance Defending Freedom
Steven G. Bradbury, The Heritage Foundation
Preston Brashers, The Heritage Foundation
Jonathan Bronitsky, ATHOS

Kyle Brosnan, The Heritage Foundation

— XXV —

Mandate for Leadership: The Conservative Promise

Patrick T. Brown, Ethics and Public Policy Center
Robert Burkett, ACLJ Action

Michael Burley, American Cornerstone Institute
David R. Burton, The Heritage Foundation
Jonathan Butcher, The Heritage Foundation

Mark Buzby, Buzby Maritime Associates, LLC
Margaret Byfield, American Stewards of Liberty
David Byrd, Korn Ferry

Anthony Campau, Center for Renewing America
James Jay Carafano, The Heritage Foundation
Frank Carroll, Professional Forest Management
Oren Cass, American Compass

Brian J. Cavanaugh, American Global Strategies
Spencer Chretien, The Heritage Foundation

Claire Christensen, American Cornerstone Institute
Victoria Coates, The Heritage Foundation

Ellie Cohanim, Independent Women’s Forum

Ezra Cohen

Elbridge Colby, Marathon Initiative

Earl Comstock, White & Case LLP

Lisa Correnti, Center for Family and Human Rights (C-Fam)
Monica Crowley, The Nixon Seminar

Laura Cunliffe, Independent Women’s Forum

Tom Dans, Amberwave Partners

Sohan Dasgupta, Taft Stettinius & Hollister LLP
Sergio de la Pena

Chris De Ruyter, National Center for Urban Operations
Corey DeAngelis, American Federation for Children
Caroline DeBerry, Paragon Health Institute
Arielle Del Turco, Family Research Council

Irv Dennis, American Cornerstone Institute

David Deptula, Mitchell Institute for Aerospace Studies
Donald Devine, The Fund for American Studies
Chuck DeVore, Texas Public Policy Foundation

C. Wallace DeWitt, Allen & Overy LLP

James Di Pane, The Heritage Foundation

Matthew Dickerson, The Heritage Foundation
Michael Ding, America First Legal Foundation
David Ditch, The Heritage Foundation

Natalie Dodson, Ethics and Public Policy Center
Dave Dorey, The Fairness Center

Max Eden, American Enterprise Institute

— xxvi —

2025 Presidential Transition Project

Troy Edgar, IBM Consulting

Joseph Edlow, The Heritage Foundation

Jen Ehlinger, Booz Allen Hamilton

John Ehrett, Office of Senator Josh Hawley
Kristen Eichamer, The Heritage Foundation
Robert S. Eitel, Defense of Freedom Institute for Policy Studies
Will Estrada, Parents Rights Foundation

Jon Feere, Center for Immigration Studies
Baruch Feigenbaum, Reason Foundation

Travis Fisher, The Heritage Foundation

George Fishman, Center for Immigration Studies
Leslie Ford, The Heritage Foundation

Aharon Friedman, Federal Policy Group

Bruce Frohnen, Ohio Northern University College of Law
Joel Frushone, Ernst & Young

Finch Fulton

Diana Furchtgott-Roth, The Heritage Foundation
Caleigh Gabel, American Cornerstone Institute
Christopher Gacek, Family Research Council
Alexandra Gaiser, River Financial Inc.

Mario Garza

Patty-Jane Geller, The Heritage Foundation
Andrew Gillen, Texas Public Policy Foundation
James S. Gilmore III, Gilmore Global Group LLC
Vance Ginn, Economic Consulting, LLC

Alma Golden, The Institute for Women’s Health
Mike Gonzalez, The Heritage Foundation
Chadwick R. Gore, Defense Forum Foundation
David Gortler, Ethics and Public Policy Center
Brian Gottstein, The Heritage Foundation

Dan Greenberg, Competitive Enterprise Institute
Rob Greenway, Hudson Institute

Rachel Greszler, The Heritage Foundation

DJ Gribbin, Madrus Consulting

Garrison Grisedale, American Cornerstone Institute
Joseph Grogan, USC Schaeffer School for Health Policy and Economics
Andrew Guernsey

Jeffrey Gunter, Republican Jewish Coalition

Joe Guy, Club for Growth

Joseph Guzman

Amalia Halikias, The Heritage Foundation

Gene Hamilton, America First Legal Foundation

— xxvii —

Mandate for Leadership: The Conservative Promise

Richard Hanania, Center for the Study of Partisanship and Ideology
Simon Hankinson, The Heritage Foundation
David Harlow

Derek Harvey, Office of Congressman Devin Nunes
Jason Hayes, Mackinac Center for Public Policy
Jennifer Hazelton

Lou Heinzer

Edie Heipel

Troup Hemenway, Personnel Policy Operations
Nathan Hitchen, Equal Rights Institute

Pete Hoekstra

Gabriella Hoffman, Independent Women’s Forum
Tom Homan, The Heritage Foundation

Chris Horner

Mike Howell, The Heritage Foundation

Valerie Huber, The Institute for Women’s Health
Andrew Hughes, American Cornerstone Institute
Joseph Humire, Center for a Secure Free Society
Christopher Iacovella, American Securities Association
Melanie Israel, The Heritage Foundation

Ken Ivory, Utah House of Representatives

Roman Jankowski, The Heritage Foundation
Abby Jones

Emilie Kao, Alliance Defending Freedom

Jared M. Kelson, Boyden Gray & Associates
Aaron Kheriaty, Ethics and Public Policy Center
Ali Kilmartin, Alliance Defending Freedom

Julie Kirchner, Federation for American Immigration Reform
Dan Kish, Institute for Energy Research

Kenneth A. Klukowski

Adam Korzeniewski, American Principles Project
Kathy Nuebel Kovarik, Sagitta Solutions, LLC
Bethany Kozma, Keystone Policy

Matthew Kozma

Julius Krein, American Affairs

Stanley Kurtz, Ethics and Public Policy Center
David LaCerte, Baker Botts, LLP

Paul J. Larkin, The Heritage Foundation

Kent Lassman, Competitive Enterprise Institute
James R. Lawrence III, Envisage Law

Paul Lawrence, Lawrence Consulting

Nathan Leamer, Targeted Victory

— xxviii —

2025 Presidential Transition Project

David Legates, University of Delaware (Ret.)
Marlo Lewis, Competitive Enterprise Institute
Ben Lieberman, Competitive Enterprise Institute
John Ligon

Evelyn Lim, American Cornerstone Institute
Mario Loyola, Competitive Enterprise Institute
John G. Malcolm, The Heritage Foundation
Joseph Masterman, Cooper & Kirk, PLLC

Earl Matthews, The Vandenberg Coalition

Dan Mauler, Heritage Action for America

Drew McCall, American Cornerstone Institute
Trent McCotter, Boyden Gray & Associates
Micah Meadowcroft, The American Conservative
Edwin Meese III, The Heritage Foundation
Jessica Melugin, Competitive Enterprise Institute
Frank Mermoud, Orpheus International

Mark Miller, Office of Governor Kristi Noem
Cleta Mitchell, Conservative Partnership Institute
Kevin E. Moley

Caitlin Moon, American Center for Law & Justice
David Moore, Brigham Young University Law School
Clare Morell, Ethics and Public Policy Center
Mark Morgan, The Heritage Foundation

Hunter Morgen, American Cornerstone Institute
Rachel Morrison, Ethics and Public Policy Center
Jonathan Moy, The Heritage Foundation

Iain Murray, Competitive Enterprise Institute
Ryan Nabil, National Taxpayers Union

Michael Nasi, Jackson Walker LLP

Lucien Niemeyer, The Niemeyer Group, LLC
Nazak Nikakhtar, Wiley Rein LLP

Milan “Mitch” Nikolich

Matt O’Brien, Immigration Reform Law Institute
Caleb Orr, Boyden Gray & Associates

Michael Pack

Leah Pedersen

Michael Pillsbury, The Heritage Foundation
Patrick Pizzella, Leadership Institute

Robert Poole, Reason Foundation

Kevin Preskenis, Allymar Health Solutions

Pam Pryor, National Committee for Religious Freedom
Thomas Pyle, Institute for Energy Research

— Xxix —

Mandate for Leadership: The Conservative Promise

John Ratcliffe, American Global Strategies

Paul Ray, The Heritage Foundation

Joseph Reddan, Flexilis Forestry, LLC

Jay W. Richards, The Heritage Foundation

Jordan Richardson, Heise Suarez Melville, P.A.

Jason Richwine, Center for Immigration Studies
Shaun Rieley, The American Conservative

Lora Ries, The Heritage Foundation

Leo Rios

Mark Robeck, Energy Evolution Consulting LLC
James Rockas, ACLJ Action

Mark Royce, NOVA-Annandale College

Reed Rubinstein, America First Legal Foundation
William Ruger, American Institute for Economic Research
Austin Ruse, Center for Family and Human Rights (C-Fam)
Brent D. Sadler, The Heritage Foundation

Alexander William Salter, Texas Tech University

Jon Sanders, John Locke Foundation

Carla Sands, America First Policy Institute

Robby Stephany Saunders, Coalition for a Prosperous America
David Sauve

Brett D. Schaefer, The Heritage Foundation

Nina Owcharenko Schaefer, The Heritage Foundation
Matt Schuck, American Cornerstone Institute

Justin Schwab, CGCN Law

Jon Schweppe, American Principles Project

Marc Scribner, Reason Foundation

Darin Selnick, Selnick Consulting

Josh Sewell, Taxpayers for Common Sense

Kathleen Sgamma, Western Energy Alliance

Matt Sharp, Alliance Defending Freedom

Judy Shelton, Independent Institute

Nathan Simington

Loren Smith, Skyline Policy Risk Group

Zack Smith, The Heritage Foundation

Jack Spencer, The Heritage Foundation

Adrienne Spero, U.S. House Committee on Homeland Security
Thomas W. Spoehr, The Heritage Foundation

Peter St Onge, The Heritage Foundation

Chris Stanley, Functional Government Initiative
Paula M. Stannard

Parker Stathatos, Texas Public Policy Foundation

— XXX —

2025 Presidential Transition Project

William Steiger, Independent Consultant

Kenny Stein, Institute for Energy Research

Corey Stewart, Stewart PLLC

Mari Stull

Katharine T. Sullivan, 1792 Exchange

Brett Swearingen, Miller Johnson

Michael Sweeney

Robert Swope

Aaron Szabo, CGCN Group

Katy Talento, AllBetter Health

Tony Tata, Tata Leadership Group, LLC

Farnaz Farkish Thompson

Todd Thurman, American Cornerstone Institute
Brett Tolman, Tolman Group

Kayla M. Tonnessen, Recovery for America Now Foundation
Joe Trotter, American Legislative Exchange Council
Tevi Troy, Mercatus Center

Clayton Tufts

Erin Valdez, Texas Public Policy Foundation

Mark Vandroff

Jessica M. Vaughan, Center for Immigration Studies
John “JV” Venable, The Heritage Foundation
Morgan Lorraine Viiia, Jewish Institute for National Security of America
Andrew N. Vollmer, Mercatus Center

Hans A. von Spakovsky, The Heritage Foundation
Greg Walcher, Natural Resources Group, LLC
David M. Walsh, Takota Group

Erin Walsh, The Heritage Foundation

Jacklyn Ward, American Cornerstone Institute
Emma Waters, The Heritage Foundation

Michael Williams, American Cornerstone Institute
Aaron Wolff

Jonathan Wolfson

Alexei Woltornist, ATHOS

Frank Wuco

Cesar Ybarra, Freedom Works

John Zadrozny, America First Legal Foundation
Laura Zorc, FreedomWorks

— Xxxi —

Foreword

A PROMISE
TO AMERICA
Kevin D. Roberts, PhD

orty-four years ago, the United States and the conservative movement were
in dire straits. Both had been betrayed by the Washington establishment
and were uncertain whom to trust. Both were internally splintered and stra-
tegically adrift. Worse still, at that moment of acute vulnerability and division, we
found ourselves besieged by existential adversaries, foreign and domestic. The late
1970s were by any measure a historic low point for America and the political coa-
lition dedicated to preserving its unique legacy of human flourishing and freedom.
Today, America and the conservative movement are enduring an era of division
and danger akin to the late 1970s. Now, as then, our political class has been discred-
ited by wholesale dishonesty and corruption. Look at America under the ruling
and cultural elite today: Inflation is ravaging family budgets, drug overdose deaths
continue to escalate, and children suffer the toxic normalization of transgender-
ism with drag queens and pornography invading their school libraries. Overseas,
a totalitarian Communist dictatorship in Beijing is engaged in a strategic, cultural,
and economic Cold War against America’s interests, values, and people—all while
globalist elites in Washington awaken only slowly to that growing threat. Moreover,
low-income communities are drowning in addiction and government dependence.
Contemporary elites have even repurposed the worst ingredients of 1970s “radical
chic” to build the totalitarian cult known today as “The Great Awokening.” And
now, as then, the Republican Party seems to have little understanding about what
to do. Most alarming of all, the very moral foundations of our society are in peril.
Yet students of history will note that, notwithstanding all those challenges,
the late 1970s proved to be the moment when the political Right unified itself

Mandate for Leadership: The Conservative Promise

and the country and led the United States to historic political, economic, and
global victories.

The Heritage Foundation is proud to have played a small but pivotal role in that
story. It was in early 1979—amid stagflation, gas lines, and the Red Army’s inva-
sion of Afghanistan, the nadir of Jimmy Carter’s days of malaise—that Heritage
launched the Mandate for Leadership project. We brought together hundreds of
conservative scholars and academics across the conservative movement. Together,
this team created a 20-volume, 3,000-page governing handbook containing more
than 2,000 conservative policies to reform the federal government and rescue
the American people from Washington dysfunction. It was a promise from the
conservative movement to the country—confident, specific, and clear.

Mandate for Leadership was published in January 1981—the same month Ronald
Reagan was sworn into his presidency. By the end of that year, more than 60 percent
of its recommendations had become policy—and Reagan was on his way to ending
stagflation, reviving American confidence and prosperity, and winning the Cold War.

The bad news today is that our political establishment and cultural elite have
once again driven America toward decline. The good news is that we know the
way out even though the challenges today are not what they were in the 1970s.
Conservatives should be confident that we can rescue our kids, reclaim our culture,
revive our economy, and defeat the anti-American Left—at home and abroad. We
did it before and will do it again.

As Ronald Reagan put it:

Freedom is a fragile thing and it’s never more than one generation away from
extinction. It is not ours by way of inheritance; it must be fought for and
defended constantly by each generation[.]'

This is the duty history has put before us and the standard by which our gen-
eration of conservatives will be judged. And we should not want it any other way.

The legacy of Mandate for Leadership, and indeed of the entire Reagan Rev-
olution, is that if conservatives want to save the country, we need a bold and
courageous plan. This book is the first step in that plan.

THE CONSERVATIVE PROMISE

This volume—The Conservative Promise—is the opening salvo of the 2025 Pres-
idential Transition Project, launched by The Heritage Foundation and our many
partners in April 2022. Its 30 chapters lay out hundreds of clear and concrete policy
recommendations for White House offices, Cabinet departments, Congress, and
agencies, commissions, and boards.

Just as important as the scope of The Conservative Promise’s recommendations
is the breadth of its authorship. This book is the product of more than 400 scholars

2025 Presidential Transition Project

and policy experts from across the conservative movement and around the country.
Contributors include former elected officials, world-renowned economists, and
veterans from four presidential Administrations. This is an agenda prepared by
and for conservatives who will be ready on Day One of the next Administration to
save our country from the brink of disaster.

The Heritage Foundation is once again facilitating this work. But as our dozens
of partners and hundreds of authors will attest, this book is the work of the entire
conservative movement. As such, the authors express consensus recommendations
already forged, especially along four broad fronts that will decide America’s future:

1. Restore the family as the centerpiece of American life and protect
our children.

2. Dismantle the administrative state and return self-governance to the
American people.

3. Defend our nation’s sovereignty, borders, and bounty against global threats.

4. Secure our God-given individual rights to live freely—what our Constitution
calls “the Blessings of Liberty.”

What makes these four pieces of the conservative promise so valuable to the
next President is that they cut through superficial distractions and focus on the
moral and foundational challenges America faces in this moment of history. This
was one of the secrets of conservatives’ success in the Reagan Era, one our gener-
ation should emulate.

As in the late 1970s, Americans today experience the failures of political and cul-
tural elites in countless ways: in the job market and in the grocery store checkout
lines, on the streets and in our schools, in the media and within our institutions. But
in truth, these daily dysfunctions are not innumerable problems, but innumerable
manifestations of a few core crises.

In 1979, the threats we faced were the Soviet Union, the socialism of 1970s lib-
erals, and the predatory deviancy of cultural elites. Reagan defeated these beasts
by ignoring their tentacles and striking instead at their hearts.

His approach to the Cold War? “We win and they lose.”

His economic agenda? The human dignity of work and its many rewards.

His platform in the culture wars? The “community of values embodied in these
words: family, work, neighborhood, peace and freedom.”

This book—and Project 2025 as a whole—will arm the next conservative Pres-
ident with the same kind of strategic clarity, but for a new age.

Mandate for Leadership: The Conservative Promise

PROMISE #1: RESTORE THE FAMILY AS THE CENTERPIECE
OF AMERICAN LIFE AND PROTECT OUR CHILDREN.

The next conservative President must get to work pursuing the true priority of
politics—the well-being of the American family.

In many ways, the entire point of centralizing political power is to subvert the
family. Its purpose is to replace people’s natural loves and loyalties with unnatu-
ral ones. You see this in the popular left-wing aphorism, “Government is simply
the name we give to the things we choose to do together.” But in real life, most of
the things people “do together” have nothing to do with government. These are
the mediating institutions that serve as the building blocks of any healthy society.
Marriage. Family. Work. Church. School. Volunteering. The name real people give
to the things we do together is community, not government. Our lives are full of
interwoven, overlapping communities, and our individual and collective happiness
depends upon them. But the most important community in each of our lives—and
the life of the nation—is the family.

Today, the American family is in crisis. Forty percent of all children are born
to unmarried mothers, including more than 70 percent of black children. There
is no government program that can replace the hole in a child’s soul cut out by
the absence of a father. Fatherlessness is one of the principal sources of Ameri-
can poverty, crime, mental illness, teen suicide, substance abuse, rejection of the
church, and high school dropouts. So many of the problems government programs
are designed to solve—but can’t—are ultimately problems created by the crisis of
marriage and the family. The world has never seen a thriving, healthy, free, and
prosperous society where most children grow up without their married parents.
If current trends continue, we are heading toward social implosion.

Furthermore, the next conservative President must understand that using gov-
ernment alone to respond to symptoms of the family crisis is a dead end. Federal
power must instead be wielded to reverse the crisis and rescue America’s kids from
familial breakdown. The Conservative Promise includes dozens of specific policies
to accomplish this existential task.

Some are obvious and long-standing goals like eliminating marriage penalties
in federal welfare programs and the tax code and installing work requirements for
food stamps. But we must go further. It’s time for policymakers to elevate family
authority, formation, and cohesion as their top priority and even use government
power, including through the tax code, to restore the American family.

Today the Left is threatening the tax-exempt status of churches and charities
that reject woke progressivism. They will soon turn to Christian schools and clubs
with the same totalitarian intent.

The next conservative President must make the institutions of American civil
society hard targets for woke culture warriors. This starts with deleting the terms
sexual orientation and gender identity (““SOGI”), diversity, equity, and inclusion

2025 Presidential Transition Project

(“DEI”), gender, gender equality, gender equity, gender awareness, gender-sensi-
tive, abortion, reproductive health, reproductive rights, and any other term used
to deprive Americans of their First Amendment rights out of every federal rule,
agency regulation, contract, grant, regulation, and piece of legislation that exists.

Pornography, manifested today in the omnipresent propagation of transgender
ideology and sexualization of children, for instance, is not a political Gordian knot
inextricably binding up disparate claims about free speech, property rights, sexual
liberation, and child welfare. It has no claim to First Amendment protection. Its
purveyors are child predators and misogynistic exploiters of women. Their product
is as addictive as any illicit drug and as psychologically destructive as any crime.
Pornography should be outlawed. The people who produce and distribute it should
be imprisoned. Educators and public librarians who purvey it should be classed
as registered sex offenders. And telecommunications and technology firms that
facilitate its spread should be shuttered.

In our schools, the question of parental authority over their children’s education
is asimple one: Schools serve parents, not the other way around. That is, of course,
the best argument for universal school choice—a goal all conservatives and con-
servative Presidents must pursue. But even before we achieve that long-term goal,
parents’ rights as their children’s primary educators should be non-negotiable in
American schools. States, cities and counties, school boards, union bosses, princi-
pals, and teachers who disagree should be immediately cut off from federal funds.

The noxious tenets of “critical race theory” and “gender ideology” should be
excised from curricula in every public school in the country. These theories poison
our children, who are being taught on the one hand to affirm that the color of their
skin fundamentally determines their identity and even their moral status while
on the other they are taught to deny the very creatureliness that inheres in being
human and consists in accepting the givenness of our nature as men or women.

Allowing parents or physicians to “reassign” the sex of a minor is child abuse and
must end. For public institutions to use taxpayer dollars to declare the superiority
or inferiority of certain races, sexes, and religions is a violation of the Constitu-
tion and civil rights law and cannot be tolerated by any government anywhere in
the country.

But the pro-family promises expressed in this book, and central to the next
conservative President’s agenda, must go much further than the traditional, narrow
definition of “family issues.” Every threat to family stability must be confronted.

This resolve should color each of our policies. Consider our approach to Big
Tech. The worst of these companies prey on children, like drug dealers, to get them
addicted to their mobile apps. Many Silicon Valley executives famously don’t let
their own kids have smart phones.” They nevertheless make billions of dollars
addicting other people’s children to theirs. TikTok, Instagram, Facebook, Twitter,
and other social media platforms are specifically designed to create the digital

Mandate for Leadership: The Conservative Promise

dependencies that fuel mental illness and anxiety, to fray children’s bonds with
their parents and siblings. Federal policy cannot allow this industrial-scale child
abuse to continue.

Finally, conservatives should gratefully celebrate the greatest pro-family win
in a generation: overturning Roe v. Wade, a decision that for five decades made a
mockery of our Constitution and facilitated the deaths of tens of millions of unborn
children. But the Dobbs decision is just the beginning. Conservatives in the states
and in Washington, including in the next conservative Administration, should
push as hard as possible to protect the unborn in every jurisdiction in America. In
particular, the next conservative President should work with Congress to enact the
most robust protections for the unborn that Congress will support while deploying
existing federal powers to protect innocent life and vigorously complying with
statutory bans on the federal funding of abortion. Conservatives should ardently
pursue these pro-life and pro-family policies while recognizing the many women
who find themselves in immensely difficult and often tragic situations and the hero-
ism of every choice to become a mother. Alternative options to abortion, especially
adoption, should receive federal and state support.

Insummary, the next President has a moral responsibility to lead the nation in
restoring a culture of life in America again.

PROMISE #2: DISMANTLE THE ADMINISTRATIVE STATE AND
RETURN SELF-GOVERNANCE TO THE AMERICAN PEOPLE.

Of course, the surest way to put the federal government back to work for the
American people is to reduce its size and scope back to something resembling
the original constitutional intent. Conservatives desire a smaller government
not for its own sake, but for the sake of human flourishing. But the Washington
Establishment doesn’t want a constitutionally limited government because it
means they lose power and are held more accountable by the people who put
them in power.

Like restoring popular sovereignty, the task of reattaching the federal gov-
ernment’s constitutional and democratic tethers calls to mind Ronald Reagan’s
observation that “there are no easy answers, but there are simple answers.”

In the case of making the federal government smaller, more effective, and
accountable, the simple answer is the Constitution itself. The surest proof of this
is how strenuously and creatively generations of progressives and many Repub-
lican insiders have worked to cut themselves free from the strictures of the 1789
Constitution and subsequent amendments.

Consider the federal budget. Under current law, Congress is required to pass
a budget—and 12 issue-specific spending bills comporting with it—every single
year. The last time Congress did so was in 1996. Congress no longer meaningfully
budgets, authorizes, or categorizes spending.

2025 Presidential Transition Project

Instead, party leaders negotiate one multitrillion-dollar spending bill—several
thousand pages long—and then vote on it before anyone, literally, has had a chance
to read it. Debate time is restricted. Amendments are prohibited. And all of this
is backed up against a midnight deadline when the previous “omnibus” spending
bill will run out and the federal government “shuts down.”

This process is not designed to empower 330 million American citizens and
their elected representatives, but rather to empower the party elites secretly nego-
tiating without any public scrutiny or oversight.

In the end, congressional leaders’ behavior and incentives here are no differ-
ent from those of global elites insulating policy decisions—over the climate, trade,
public health, you name it—from the sovereignty of national electorates. Public
scrutiny and democratic accountability make life harder for policymakers—so they
skirt it. It’s not dysfunction; it’s corruption.

And despite its gaudy price tag, the federal budget is not even close to the worst
example of this corruption. That distinction belongs to the “Administrative State,”
the dismantling of which must a top priority for the next conservative President.

The term Administrative State refers to the policymaking work done by the
bureaucracies of all the federal government’s departments, agencies, and millions
of employees. Under Article I of the Constitution, “All legislative Powers herein
granted shall be vested in a Congress of the United States, which shall consist of
a Senate and a House of Representatives.” That is, federal law is enacted only by
elected legislators in both houses of Congress.

This exclusive authority was part of the Framers’ doctrine of “separated powers.”
They not only split the federal government’s legislative, executive, and judicial
powers into different branches. They also gave each branch checks over the others.
Under our Constitution, the legislative branch—Congress—is far and away the most
powerful and, correspondingly, the most accountable to the people.

Inrecent decades, members of the House and Senate discovered that if they give
away that power to the Article II branch of government, they can also deny responsi-
bility for its actions. So today in Washington, most policy is no longer set by Congress
at all, but by the Administrative State. Given the choice between being powerful but
vulnerable or irrelevant but famous, most Members of Congress have chosen the latter.

Congress passes intentionally vague laws that delegate decision-making over
a given issue to a federal agency. That agency’s bureaucrats—not just unelected
but seemingly un-fireable—then leap at the chance to fill the vacuum created by
Congress’s preening cowardice. The federal government is growing larger and less
constitutionally accountable—even to the President—every year.

e Acombination of elected and unelected bureaucrats at the Environmental
Protection Agency quietly strangles domestic energy production through
difficult-to-understand rulemaking processes;

Mandate for Leadership: The Conservative Promise

e Bureaucrats at the Department of Homeland Security, following the lead
of a feckless Administration, order border and immigration enforcement
agencies to help migrants criminally enter our country with impunity;

e Bureaucrats at the Department of Education inject racist, anti-American,
ahistorical propaganda into America’s classrooms;

e Bureaucrats at the Department of Justice force school districts to
undermine girls’ sports and parents’ rights to satisfy transgender extremists;

e Woke bureaucrats at the Pentagon force troops to attend “training”
seminars about “white privilege”; and

e Bureaucrats at the State Department infuse U.S. foreign aid programs with
woke extremism about “intersectionality” and abortion.*

Unaccountable federal spending is the secret lifeblood of the Great Awokening.
Nearly every power center held by the Left is funded or supported, one way or
another, through the bureaucracy by Congress. Colleges and school districts are
funded by tax dollars. The Administrative State holds 100 percent of its power at
the sufferance of Congress, and its insulation from presidential discipline is an
unconstitutional fairy tale spun by the Washington Establishment to protect its
turf. Members of Congress shield themselves from constitutional accountability
often when the White House allows them to get away with it. Cultural institutions
like public libraries and public health agencies are only as “independent” from
public accountability as elected officials and voters permit.

Let’s be clear: The most egregious regulations promulgated by the current
Administration come from one place: the Oval Office. The President cannot hide
behind the agencies; as his many executive orders make clear, his is the respon-
sibility for the regulations that threaten American communities, schools, and
families. A conservative President must move swiftly to do away with these vast
abuses of presidential power and remove the career and political bureaucrats
who fuel it.

Properly considered, restoring fiscal limits and constitutional accountability
to the federal government is a continuation of restoring national sovereignty to
the American people. In foreign affairs, global strategy, federal budgeting and pol-
icymaking, the same pattern emerges again and again. Ruling elites slash and tear
at restrictions and accountability placed on them. They centralize power up and
away from the American people: to supra-national treaties and organizations, to
left-wing “experts,” to sight-unseen all-or-nothing legislating, to the unelected
career bureaucrats of the Administrative State.

2025 Presidential Transition Project

As monolithic as the Left’s institutional power appears to be, it originates with
appropriations from Congress and is made complete by a feckless President. A
conservative President must look to the legislative branch for decisive action. The
Administrative State is not going anywhere until Congress acts to retrieve its own
power from bureaucrats and the White House. But in the meantime, there are
many executive tools a courageous conservative President can use to handcuff the
bureaucracy, push Congress to return to its constitutional responsibility, restore
power over Washington to the American people, bring the Administrative State
to heel, and in the process defang and defund the woke culture warriors who have
infiltrated every last institution in America.

The Conservative Promise lays out how to use many of these tools including:
how to fire supposedly “un-fireable” federal bureaucrats; how to shutter wasteful
and corrupt bureaus and offices; how to muzzle woke propaganda at every level of
government; how to restore the American people’s constitutional authority over
the Administrative State; and how to save untold taxpayer dollars in the process.

Finally, the President can restore public confidence and accountability to our
most important government function of all: national defense. The American people
desire a military full of highly skilled servicemen and women who can protect the
homeland and our interests overseas. The next conservative President must end
the Left’s social experimentation with the military, restore warfighting as its sole
mission, and set defeating the threat of the Chinese Communist Party as its high-
est priority.

The next conservative President must possess the courage to relentlessly put
the interests of the everyday American over the desires of the ruling elite. Their
outrage cannot be prevented; it must simply be ignored. And it can be. The Left
derives its power from the institutions they control. But those institutions are only
powerful to the extent that constitutional officers surrender their own legitimate
authority to them. A President who refuses to do so and uses his or her office to
reimpose constitutional authority over federal policymaking can begin to correct
decades of corruption and remove thousands of bureaucrats from the positions
of public trust they have so long abused.

PROMISE #3: DEFEND OUR NATION’S SOVEREIGNTY,
BORDERS, AND BOUNTY AGAINST GLOBAL THREATS.

The United States belongs to “We the people.” All government authority derives
from the consent of the people, and our nation’s success derives from the character
of its people. The American people’s right to rule ourselves is the obverse of our
duty: We cannot outsource to others our obligation to ensure the conditions that
allow our families, local communities, churches and synagogues, and neighbor-
hoods to thrive. The buck stops with each of us, so each of us must have the freedom
to pursue the good for ourselves and those entrusted to our care.

Mandate for Leadership: The Conservative Promise

To most Americans, this is common sense. But in Washington, D.C. and other
centers of Leftist power like the media and the academy, this statement of basic
civics is branded hate speech. Progressive elites speak in lofty terms of openness,
progress, expertise, cooperation, and globalization. But too often, these terms are
just rhetorical Trojan horses concealing their true intention—stripping “we the
people” of our constitutional authority over our country’s future.

America’s corporate and political elites do not believe in the ideals to which our
nation is dedicated—self-governance, the rule of law, and ordered liberty. They
certainly do not trust the American people, and they disdain the Constitution’s
restrictions on their ambitions.

Instead, they believe in a kind of 21st century Wilsonian order in which the

“enlightened,” highly educated managerial elite runs things rather than the humble,
patriotic working families who make up the majority of what the elites contemp-
tuously call “fly-over country.”

This Wilsonian hubris has spread like a cancer through many of America’s larg-
est corporations, its public institutions, and its popular culture. Those who run our
so-called American corporations have bent to the will of the woke agenda and care
more for their foreign investors and organizations than their American workers
and customers. Today, nearly every top-tier U.S. university president or Wall Street
hedge fund manager has more in common with a socialist, European head of state
than with the parents at a high school football game in Waco, Texas. Many elites’
entire identity, it seems, is wrapped up in their sense of superiority over those
people. But under our Constitution, they are the mere equals of the workers who
shower after work instead of before.

This is as it should and must be. Intellectual sophistication, advanced degrees,
financial success, and all other markers of elite status have no bearing on a per-
son’s knowledge of the one thing most necessary for governance: what it means
to live well. That knowledge is available to each of us, no matter how humble our
backgrounds or how unpretentious our attainments. It is open to us to read in
the book of human nature, to which we are all offered the key just by merit of
our shared humanity. One of the great premises of American political life is that
everyone who can read in that book must have a voice in deciding the course and
fate of our Republic.

Progressive policymakers and pundits in America either fail to understand this
premise or intentionally reject it. They enthusiastically support supranational
organizations like the United Nations and European Union, which are run and
staffed almost entirely by people who share their values and are mostly insulated
from the influence of national elections. That’s why they are eager for America to
sign international treaties on everything from pharmaceutical patents to climate
change to “the rights of the child”—and why those treaties invariably endorse poli-
cies that could never pass through the U.S. Congress. Like the progressive Woodrow

2025 Presidential Transition Project

Wilson a century ago, the woke Left today seeks a world, bound by global treaties
they write, in which they exercise dictatorial powers over all nations without being
subject to democratic accountability.

That’s why today’s progressive Left so cavalierly supports open borders despite
the lawless humanitarian crisis their policy created along America’s southern
border. They seek to purge the very concept of the nation-state from the Amer-
ican ethos, no matter how much crime increases or resources drop for schools
and hospitals or wages decrease for the working class. Open-borders activism is a
classic example of what the German theologian Dietrich Bonhoeffer called “cheap
grace”—publicly promoting one’s own virtue without risking any personal incon-
venience. Indeed, the only direct impact of open borders on pro-open borders
elites is that the constant flow of illegal immigration suppresses the wages of their
housekeepers, landscapers, and busboys.

“Cheap grace” aptly describes the Left’s love affair with environmental extrem-
ism. Those who suffer most from the policies environmentalism would have us
enact are the aged, poor, and vulnerable. It is not a political cause, but a pseu-
do-religion meant to baptize liberals’ ruthless pursuit of absolute power in the
holy water of environmental virtue.

At its very heart, environmental extremism is decidedly anti-human. Stew-
ardship and conservation are supplanted by population control and economic
regression. Environmental ideologues would ban the fuels that run almost all of the
world’s cars, planes, factories, farms, and electricity grids. Abandoning confidence
in human resilience and creativity in responding to the challenges of the future
would raise impediments to the most meaningful human activities. They would
stand human affairs on their head, regarding human activity itself as fundamentally
a threat to be sacrificed to the god of nature.

The same goals are the heart of elite support for economic globalization. For 30
years, America’s political, economic, and cultural leaders embraced and enriched
Communist China and its genocidal Communist Party while hollowing out Ameri-
ca’s industrial base. What may have started out with good intentions has now been
made clear. Unfettered trade with China has been a catastrophe. It has made a
handful of American corporations enormously profitable while twisting their
business incentives away from the American people’s needs. For a generation, pol-
iticians of both parties promised that engagement with Beijing would grow our
economy while injecting American values into China. The opposite has happened.
American factories have closed. Jobs have been outsourced. Our manufacturing
economy has been financialized. And all along, the corporations profiting failed
to export our values of human rights and freedom; rather, they imported China’s
anti-American values into their C-suites.

Even before the rise of Big Tech, Wall Street ignored China’s serial theft of
American intellectual property. It outright cheered the elimination of American

Mandate for Leadership: The Conservative Promise

manufacturing jobs. (“Learn to code!” they would gloat.) These were just the price
of progress. Engagement was at every step Beijing’s project, not America’s. The
Chinese Communist Party (CCP) dictated terms, only to break them whenever it
suited them. They stole our technology, spied on our people, and threatened our
allies, all with trillions of dollars of wealth and military power financed by their
access to our market.

Then came the rise of Big Tech, which is now less a contributor to the U.S.
economy than it is a tool of China’s government. In exchange for cheap labor and
regulatory special treatment from Beijing, America’s largest technology firms
funnel data about Americans to the CCP. They hand over sensitive intellectual
property with military and intelligence applications to keep the money rolling
in. They let Beijing censor Chinese users on their platforms. They let the CCP
set their corporate policies about mobile apps. And they run interference for our
rival’s political priorities in Washington. One side of Big-Tech companies’ business
model is old-fashioned American competitiveness and world-changing techno-
logical innovation; but increasingly, that side of these businesses is overshadowed
by their role as operatives in the lucrative employ of America’s most dangerous
international enemy.

If you want to understand the danger posed by collaboration between Big Tech
and the CCP, look no further than TikTok. The highly addictive video app, used by
80 million Americans every month and overwhelmingly popular among teenage
girls, is in effect a tool of Chinese espionage. The ties between TikTok and the
Chinese government are not loose, and they are not coincidental.

The same can be observed of many U.S. colleges and universities. Through the
CCP’s Confucius Institutes, Beijing has been just as successful at compromising
and coopting our higher education system as they have at compromising and coopt-
ing corporate America.

A casual reader might take the last few pages as surveying a broad array of
challenges facing the American people and the next conservative President: supra-
national policymaking, border security, globalization, engagement with China,
manufacturing, Big Tech, and Beijing-compromised colleges.

But these really are not many issues, but two: (1) that China is a totalitarian
enemy of the United States, not a strategic partner or fair competitor, and (2) that
America’s elites have betrayed the American people. The solution to all of the above
problems is not to tinker with this or that government program, to replace this or
that bureaucrat. These are problems not of technocratic efficiency but of national
sovereignty and constitutional governance. We solve them not by trimming and
reshaping the leaves but by ripping out the trees—root and branch.

International organizations and agreements that erode our Constitution, rule
of law, or popular sovereignty should not be reformed: They should be aban-
doned. Illegal immigration should be ended, not mitigated; the border sealed, not

2025 Presidential Transition Project

reprioritized. Economic engagement with China should be ended, not rethought.
Our manufacturing and industrial base should be restored, not allowed to dete-
riorate further. Confucius Institutes, TikTok, and any other arm of Chinese

propaganda and espionage should be outlawed, not merely monitored. Univer-
sities taking money from the CCP should lose their accreditation, charters, and

eligibility for federal funds.

The next conservative President should go beyond merely defending America’s
energy interests but go on offense, asserting them around the world. America’s
vast reserves of oil and natural gas are not an environmental problem; they are the
lifeblood of economic growth. American dominance of the global energy market
would be a good thing: for the world, and, more importantly, for “we the people.”
It’s not just about jobs, even though unleashing domestic energy production would
create millions of them. It’s not just about higher wages for workers who didn’t
go to college, though they would receive the raises they have missed out on for
two generations. Full-spectrum strategic energy dominance would facilitate the
reinvigoration of America’s entire industrial and manufacturing sector as we dis-
entangle our economy from China. Globally, it would rebalance power away from
dangerous regimes in Russia and the Middle East. It would build powerful alliances
with fast-growing nations in Africa and provide us the leverage to counter Chi-
nese ambitions in South America and the Pacific. Locally, it would drive billions
of dollars of private investment to the communities that have been hammered by
globalization since the 1990s. And it would clarify our intentions to Beijing that
the next President can ensure that a large part of America’s reindustrialization is in
the production of the equipment we will need to dissuade future foreign meddling
with U.S. vital interests.

PROMISE #4 SECURE OUR GOD-GIVEN INDIVIDUAL
RIGHT TO ENJOY “THE BLESSINGS OF LIBERTY.”

The Declaration of Independence famously asserted the belief of America’s
Founders that “all men are created equal” and endowed with God-given rights to
“Life, Liberty, and the pursuit of Happiness.” It’s the last—“the pursuit of Happi-

ness”—that is central to America’s heroic experiment in self-government.

When the Founders spoke of “pursuit of Happiness,” what they meant might
be understood today as in essence “pursuit of Blessedness.” That is, an individual
must be free to live as his Creator ordained—to flourish. Our Constitution grants
each of us the liberty to do not what we want, but what we ought. This pursuit of the
good life is found primarily in family—marriage, children, Thanksgiving dinners,
and the like. Many find happiness through their work. Think of dedicated teach-
ers or health care professionals you know, entrepreneurs or plumbers throwing
themselves into their businesses—anyone who sees a job well done as a personal
reward. Religious devotion and spirituality are the greatest sources of happiness

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Mandate for Leadership: The Conservative Promise

around the world. Still others find themselves happiest in their local voluntary
communities of friends, their neighbors, their civic or charitable work.

The American Republic was founded on principles prioritizing and maximizing
individuals’ rights to live their best life or to enjoy what the Framers called “the
Blessings of Liberty.” It’s this radical equality—liberty for all—not just of rights but
of authority—that the rich and powerful have hated about democracy in America
since 1776. They resent Americans’ audacity in insisting that we don’t need them
to tell us how to live. It’s this inalienable right of self-direction—of each person’s
opportunity to direct himself or herself, and his or her community, to the good—
that the ruling class disdains.

With the Declaration and Constitution, our nation’s Founders handed to us
the means with which to preserve this right. Abraham Lincoln wrote of the Dec-
laration as an “apple of gold” ina silver frame, the Constitution. So must the next
conservative President look to these documents when the elites mount their next
assault on liberty.

Left to our own devices, the American people rejected European monarchy
and colonialism just as we rejected slavery, second-class citizenship for women,
mercantilism, socialism, Wilsonian globalism, Fascism, Communism, and (today)
wokeism. To the Left, these assertions of patriotic self-assurance are just so many
signs of our moral depravity and intellectual inferiority—proof that, in fact, we
need a ruling elite making decisions for us.

But the next conservative President should be proud, not ashamed of Americans’
unique culture of social equality and ordered liberty. After all, the countries where
Marxist elites have won political and economic power are all weaker, poorer, and
less free for it.

The United States remains the most innovative and upwardly mobile society
in the world. Government should stop trying to substitute its own preferences
for those of the people. And the next conservative President should champion
the dynamic genius of free enterprise against the grim miseries of elite-di-
rected socialism.

The promise of socialism—Communism, Marxism, progressivism, Fascism,
whatever name it chooses—is simple: Government control of the economy can
ensure equal outcomes for all people. The problem is that it has never done so.
There is no such thing as “the government.” There are just people who work for
the government and wield its power and who—at almost every opportunity—wield
it to serve themselves first and everyone else a distant second. This is not a failing
of one nation or socialist party, but inherent in human nature.

Nighttime satellite images of the Korean peninsula famously show the free-mar-
ket South lit up, with homes, businesses, and cities electrified from coast to coast.
By contrast, Communist North Korea is almost completely dark, except for the
small dot of the capital city, Pyongyang, where a psychotic dictator and his cronies

—14-—

2025 Presidential Transition Project

live. The same phenomenon is on display in the infuriating fact that four of the
six richest counties in the United States are suburbs of Washington, D.C.—a city
infamous for its lack of native productive industries.

We see the same corruption expressed on an individual level whenever billion-
aire climate activists, who want to outlaw carbon-fueled transportation, fly to A-list
conferences on their private jets. Or when COVID-19 shutdown politicians like
former House Speaker Nancy Pelosi and California Governor Gavin Newsom were
caught at the hair salon or dining at fancy restaurants after moralizing about how
everyone else must stay home and forgo such luxuries during the pandemic. For
socialists, who are almost always well-to-do, socialism is not a means of equalizing
outcomes, but a means of accumulating power. They never get around to helping
anyone else.

The Soviet empire was a social and economic failure. North Korea, despite the
opulence of its tyrants, is one of the poorest nations in the world. Cuba is so corrupt
that its people regularly risk their lives to escape to Florida on rafts. Venezuela was
once the richest nation in South America; today, a decade after a Marxist dictator
took over, 94 percent of Venezuelans live in poverty.‘ Even socialist Senator Bernie
Sanders’ home state of Vermont was forced to repeal the state’s single-payer health
care system just three years after creating it.

In every case, socialist elites promised that if only they could direct the econ-
omy, everything would be better. Very quickly, everything got worse. In socialist
nation after socialist nation, the only way the government could keep its disgrun-
tled people in line was to surveil and terrorize them.

By contrast, in countries with a high degree of economic freedom, elites are
not in charge because everyone is in charge. People work, build, invest, save, and
create according to their own interests and in service to the common good of their
fellow citizens.

There is a reason why the private economy hews to the maxim “the customer
is always right” while government bureaucracies are notoriously user-unfriendly,
just as there is a reason why private charities are cheerful and government welfare
systems are not. It’s not because grocery store clerks and PTA moms are “good”
and federal bureaucrats are “bad.” It’s because private enterprises—for-profit or
nonprofit—must cooperate, to give, to succeed.

So as the American people take back their sovereignty, constitutional authority,
respect for their families and communities, they should also take back their right
to pursue the good life.

The next President should promote pro-growth economic policies that spur
new jobs and investment, higher wages, and productivity. Yes, that agenda should
include overdue tax and regulatory reform, but it should go further and include
antitrust enforcement against corporate monopolies. It should promote educa-
tional opportunities outside the woke-dominated system of public schools and

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Mandate for Leadership: The Conservative Promise

universities, including trade schools, apprenticeship programs, and student-loan
alternatives that fund students’ dreams instead of Marxist academics. Just as
important as expanding opportunities for workers and small businesses, the
next President should crack down on the crony capitalist corruption that enables
America’s largest corporations to profit through political influence rather than
competitive enterprise and customer satisfaction.

Analogous pro-growth reforms for America’s voluntary civil society are also
in order. America is not an economy; it is a country. Economic freedom is not the
only important freedom. Freedom of religion, freedom of speech, and the freedom
to assemble also represent key components of the American promise. Today, in
addition to the problem of Big Tech censorship, we see speakers at universities
shouted down, parents investigated and arrested for attempting to speak at school
board meetings, and donors to conservative causes harassed and intimidated. The
next conservative President must defend our First Amendment rights.

BEST EFFORT

Ultimately, the Left does not believe that all men are created equal—they think
they are special. They certainly don’t think all people have an unalienable right to
pursue the good life. They think only they themselves have such a right along with
a moral responsibility to make decisions for everyone else. They don’t think any
citizen, state, business, church, or charity should be allowed any freedom until
they first bend the knee.

This book, this agenda, the entire Project 2025 is a plan to unite the conservative
movement and the American people against elite rule and woke culture warriors.

Our movement has not been united in recent years, and our country has paid
the price. In the past decade, though, the breakdown of the family, the rise of
China, the Great Awokening, Big Tech’s abuses, and the erosion of constitutional
accountability in Washington have rendered these divisions not just inconvenient
but politically suicidal. Every hour the Left directs federal policy and elite institu-
tions, our sovereignty, our Constitution, our families, and our freedom are a step
closer to disappearing.

Conservatives have just two years and one shot to get this right. With enemies
at home and abroad, there is no margin for error. Time is running short. If we fail,
the fight for the very idea of America may be lost.

But we should take this small window of opportunity we have left to act with
courage and confidence, not despair. The last time our nation and movement were
so near defeat, we rallied together behind a great leader and great ideas, tran-
scended our differences, rescued our nation, and changed the world. It’s time to
do it again.

Now, as then, we know who we are fighting and what we are fighting for: for
our Republic, our freedom, and for each other. The next conservative President

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2025 Presidential Transition Project

will enter office on January 20, 2025, with a simple choice: greatness or failure. It
will be a daunting test, but no more so than every generation of Americans has

faced and passed.

The Conservative Promise represents the best effort of the conservative move-
ment in 2023—and the next conservative President’s last opportunity to save

our republic.

ENDNOTES

1. — Ronald Reagan, Inaugural Address, January 5, 1967, https://www.reaganlibrary.gov/archives/speech/january-

5-1967-inaugural-address-public-ceremony (accessed March 14, 2023).

2. Quispe Lopez, “6 Tech Executives Who Raise Their Kids Tech-Free or Seriously Limit Their Screen Time,”

Business Insider, March 5, 2020, https://www.businessinsider.com/tech-

steve-jobs-2019-9#google-ceo-sundar-pichais-middle-school-aged-so
tv-can-only-be-accessed-with-activation-energy-] (accessed March 14,

execs-screen-time-children-bill-gates-
n-doesnt-own-a-cell-phone-and-the-
2023).

3. — Simon Hankinson, ““Woke’ Public Diplomacy Undermines the State Department’s Core Mission and Weakens
U.S. Foreign Policy,” Heritage Foundation Backgrounder No. 3738, December 12, 2022, https://www.heritage.
org/global-politics/report/woke-public-diplomacy-undermines-the-state-departments-core-mission-and.

4. ichelle Nichols, “Venezuelans Facing ‘Unprecedented Challenges, Many Need Aid—Internal U.N. Report,”

nany-need-aid-internal-u-n-report-idUSKCNIR92AG (accessed March

tps://www.reuters.com/article/us-venezuela-politics-un/venezuelans-facing-unprecedented-challenges-

4, 2023).

Section One

TAKING THE REINS
OF GOVERNMENT

merica’s Bicentennial, which culminated on July 4, 1976, was a spirited
and unifying celebration of our country, its Founding, and its ideals. As we
approach our nation’s 250th anniversary, which will take place during the
next presidency, America is now divided between two opposing forces: woke revolu-
tionaries and those who believe in the ideals of the American revolution. The former
believe that America is—and always has been—“systemically racist” and that it is not
worth celebrating and must be fundamentally transformed, largely through a cen-
tralized administrative state. The latter believe in America’s history and heroes, its
principles and promise, and in everyday Americans and the American way of life. They
believe in the Constitution and republican government. Conservatives—the Ameri-
canists in this battle—must fight for the soul of America, which is very much at stake.
Just two years after the death of the last surviving Constitutional Convention
delegate, James Madison, Abraham Lincoln warned that the greatest threat to
America would come not from without, but from within. This is evident today:
Whether it be mask and vaccine mandates, school and business closures, efforts
to keep Americans from driving gas cars or using gas stoves, or efforts to defund
the police, indoctrinate schoolchildren, alter beloved books, abridge free speech,
undermine the colorblind ideal, or deny the biological reality that there are only
two sexes, the Left’s steady stream of insanity appears to be never-ending. The
next Administration must stand up for American ideals, American families, and
American culture—all things in which, thankfully, most Americans still believe.
Highlighting this need, former director of the Office of Management and Budget
Russ Vought writes in Chapter 2, “The modern conservative President’s task is to

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Mandate for Leadership: The Conservative Promise

limit, control, and direct the executive branch on behalf of the American people.”
At the core of this goal is the work of the White House and the central personnel

agencies. Article II of the Constitution vests all federal executive power in a Pres-
ident, made accountable to the citizenry through regular elections. Our Founders

wrote, “The executive Power shall be vested in a President of the United States

of America.” Accordingly, Vought writes, “it is the President’s agenda that should

matter to the departments and agencies,” not their own.

Yet the federal bureaucracy has a mind of its own. Federal employees are often
ideologically aligned—not with the majority of the American people—but with one
another, posing a profound problem for republican government, a government

“of, by, and for” the people. As Donald Devine, Dennis Kirk, and Paul Dans write
in Chapter 3, “An autonomous bureaucracy has neither independent constitu-
tional status nor separate moral legitimacy.” Byzantine personnel rules provide the
bureaucrats with their chief means of self-protection. What’s more, knowledge of
such rules is used to thwart the President’s appointees and agenda. As Devine, Kirk,
and Dans write, “Managing the immense bureaucracy of the federal government
is impossible without an understanding of the key central personnel agencies and
their governing laws and regulations.”

Many of these laws and regulations governing a largely underworked, over-
compensated, and unaccountable federal civilian workforce are so irrational that
they would be comical in a less important context. This is true whether it comes to
evaluating employees’ performance or hiring new employees. Only in the federal
government could an applicant in the hiring process be sent to the front of the
line because of a “history of drug addiction” or “alcoholism,” or due to “morbid
obesity,” “irritable bowel syndrome,” or a “psychiatric disorder.” The next Admin-
istration should insist that the federal government’s hiring, evaluation, retention,
and compensation practices benefit taxpayers, rather than benefiting the lowest
rung of the federal workforce.

In order to carry out the President’s desires, political appointees must be
given the tools, knowledge, and support to overcome the federal government’s
obstructionist Human Resources departments. More fundamentally, the new
Administration must fill its ranks with political appointees. Devine, Kirk, and Dans
observe that “the Trump Administration appointed fewer political appointees in
its first few months in office” than any other recent presidency. This left career
employees in charge in many places. This can occur even after departments have
been fully staffed with political appointees. Vought writes that the White House
Office of Management and Budget (OMB) should establish a “reputation as the

999

keeper of ‘commander’s intent,” yet OMB is dominated by career employees who
often try to overrule political appointees serving in the various executive depart-
ments. Empowering political appointees across the Administration is crucial to

a President’s success.

2025 Presidential Transition Project

Above all, the President and those who serve under him or her must be commit-
ted to the Constitution and the rule of law. This is particularly true of a conservative
Administration, which knows that the President is there to uphold the Constitu-
tion, not the other way around. If a conservative Administration does not respect
the Constitution, no Administration will. In Chapter 1, former deputy chief of
staff to the President Rick Dearborn writes that the White House Counsel “must
take seriously the duty to protect the powers and privileges of the President from
encroachments by Congress, the judiciary, and the administrative components of
departments and agencies.” Equally important, the President must enforce the
Constitution and laws as written, rather than proclaiming new “law” unilaterally.
Presidents should not issue mask or vaccine mandates, arbitrarily transfer student
loan debt, or issue monarchical mandates of any sort. Legislatures make the laws
in arepublic, not executives.

It is crucial that all three branches of the federal government respect what Mad-
ison called the “double security” to our liberties: the separation of powers among
the three branches, and the separation of powers between the federal government
and the states. This double security has been greatly compromised over the years.
Vought writes that “the modern executive branch...writes federal policy, enforces
that policy, and often adjudicates whether that policy was properly drafted and
enforced.” He describes this as “constitutionally dire” and “in urgent need of repair,”
adding: “Nothing less than the survival of self-governance in America is at stake.”

When it comes to ensuring that freedom can flourish, nothing is more import-
ant than deconstructing the centralized administrative state. Political appointees
who are answerable to the President and have decision-making authority in the
executive branch are key to this essential task. The next Administration must not
cede such authority to non-partisan “experts,” who pursue their own ends while
engaging in groupthink, insulated from American voters. The following chapters
detail how the next Administration can be responsive to the American people (not
to entrenched “elites”); how it can take care that all the laws are “faithfully exe-
cuted,” not merely those that the President desires to see executed; and how it can
achieve results and not be stymied by an unelected bureaucracy.

WHITE HOUSE OFFICE
Rick Dearborn

rom popular culture to academia, the American presidency has long been a

prominent fixture of the national imagination—naturally so since it is the

beating heart of our nation’s power and prestige. It has played, for instance,
a feature role in innumerable movies and television shows and has been prodded,
analyzed, and critiqued by countless books, essays, and studies. But like nearly
everything else in life, there is no substitute for firsthand experience, which this
manual has compiled from the experience of presidential appointees and provides
in accessible form for future use.

With respect to the presidency, it is best to begin with our Republic’s founda-
tional document. The Constitution gives the “executive Power” to the President."
It designates him as “Commander in Chief”* and gives him the responsibility to

“take Care that the Laws be faithfully executed.”? It further prescribes that the
President might seek the assistance of “the principal Officer in each of the execu-
tive Departments.”* Beginning with George Washington, every President has been
supported by some form of White House office consisting of direct staff officers as
well as a Cabinet comprised of department and agency heads.

Since the inaugural Administration of the late 18th century, citizens have chosen
to devote both their time and their talent to defending and strengthening our nation
by serving at the pleasure of the President. Their shared patriotic endeavor has
proven to be a noble one, not least because the jobs in what is now known as the
White House Office (WHO) are among the most demanding in all of government.

The President must rely on the men and women appointed to the WHO. There
simply are not enough hours in the day to manage the affairs of state single-handedly,

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Mandate for Leadership: The Conservative Promise

so delegation is not just advisable: It is essential. The decisions that assistants and
senior advisers make will directly impact the Administration, its legacy, and—most
important—the fate of the country. Their agenda must therefore be the President’s
agenda. Choosing who will carry out that agenda on a daily basis is not only one of
the first decisions a President makes in office, but also one of the most critical. The
tone and tempo of an administration are often determined on January 20.

CHIEF OF STAFF

As with most of the positions that will be covered in this first chapter, the Chief
of Staff is also an Assistant to the President. However, the chief is truly first among
equals. Of all presidential staff members, the chief is the most critical to implementa-
tion of the President’s vision for the country. The chief also has a dual role as manager
of the staffs of both the WHO and the Executive Office of the President (EOP).°

The Chief of Staff’s first managerial task is to establish an organizational chart
for the WHO. It should be simple and contain clear lines of authority and respon-
sibility to avoid conflicts. It should also identify specific points of contact for each
element of the government outside of the White House. These contacts should
include the White House Liaisons who are selected by the Office of Presidential
Personnel (PPO).

Receiving guidance from the President, the chief endeavors to implement the
President’s agenda by setting priorities for the WHO. This process begins by taking
stock of the President’s campaign promises, identifying current and prospective
opportunities, and then delegating policy priorities among the departments and
agencies of the Cabinet and throughout the three White House policy councils:

e The National Economic Council (NEC);
e The Domestic Policy Council (DPC); and
e The National Security Council (NSC).

The President is briefed on all of his policy priorities by his Cabinet and senior
staff as directed by the chief. The chief—along with senior WHO staff—maps out
the issues and themes that will be covered daily and weekly. The chief then works
with the policy councils, the Cabinet, and the Office of Communications and Office
of Legislative Affairs (OLA) to sequence and execute the rollout of policies and
announcements. White House Counsel and senior advisers and senior counselors
are also intimately involved.

All senior staff report to the Chief of Staff, either directly or through his two
or three deputies, unless the President determines that a particular Assistant to
the President reports directly to him. Most chiefs have interacted directly with

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2025 Presidential Transition Project

Cabinet officers and a select number of direct reports. In most cases, the direct
reports to the chief are his two or three deputies, the Communications Director,
PPO Director, White House Counsel, and senior advisers. Occasionally, the Office
of Public Liaison (OPL), the Cabinet Secretary, and Intergovernmental Affairs
(IGA) also report directly to the chief. Usually, however, they report instead toa
Deputy Chief of Staff.

The Chief of Staff’s main challenge is time management. His use of his deputies,
meetings with senior staff, and direction provided to the WHO must all balance
with the daily needs of the President. A successful chief steers the West Wing using
his management of and influence with the various individuals and entities around
him. It goes without saying that selecting the right person to be chief is vital.

DEPUTY CHIEFS OF STAFF

In recent years, Presidents typically have appointed two Deputy Chiefs of Staff:
a Deputy Chief of Staff for Management and Operations and a Deputy Chief of
Staff for Policy. There also have been other types of deputy chiefs whose roles have
included, for example, overseeing strategy, planning, and implementation. Chiefs
of Staff have then occasionally appointed a principal Deputy Chief to be in charge
of guiding decision-making, organizational structure, and information flow.

PRINCIPAL DEPUTY CHIEFS OF STAFF

Not all Chiefs of Staff have tapped a principal deputy. A major reason is that
doing so adds another layer of command complexity. When principal deputies
have been installed, their roles have varied based on the needs of particular chiefs.

Most principal deputies have functioned as doorkeepers, sorting through action
items, taking on those that can be handled at their own level, and passing up others
that truly require the attention of the Chief of Staff or the President. Principal
deputies also have assumed control of the scheduling functions, normally under
the operations deputy, and have worked directly with the policy councils at the
direction of the Chief of Staff. The OPL and Office of Political Affairs (OPA) also
have reported to a principal deputy.

Deputy Chief of Staff for Management and Operations. The Deputy Chief
of Staff for Management and Operations oversees the President’s schedule and
all logistical aspects of his movement within and outside of the White House (for
example, both air travel on Air Force One and Marine One and ground transpor-
tation). This deputy also interfaces directly with the Secret Service as well as the
military offices tasked with keeping the President and his family safe.

In the past, this deputy has also worked with the NSC, the Secretary of Defense,
the Secretary of State, and the Intelligence Community and on advancing all foreign
trips. If their roles are separated from that of the policy deputy, this deputy should
have a strong grasp of international affairs and robust foreign policy credentials.

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Mandate for Leadership: The Conservative Promise

This deputy further manages all facets of the working White House: technology,
grounds management, support staff, personnel administration, and communica-
tions. This individual therefore needs to be meticulous and ideally should possess
a great deal of command-and-control experience.

Deputy Chief of Staff for Policy. In some Administrations, the functions of
the IGA, OPA, and OPL and other advisers within the WHO have fallen under the
Deputy Chief of Staff for Policy. For conservatives, this arrangement could help
to connect the WHO’s outreach to political and external groups and be a strong
conduit for state and local elected officials, state party organizations, and both
grasstop and grassroots groups.

This deputy chief works directly with the Chief of Staff, Cabinet officers, and
all three policy councils to support the development and implementation of the
President’s agenda. This deputy chief should therefore have impressive policy cre-
dentials in the realms of economic, domestic, and social affairs.

SENIOR ADVISERS

Presidents have surrounded themselves with senior advisers whose experi-
ence and interests are not necessarily neatly defined. In recent Administrations,
senior advisers have been appointed to offer broad guidance on political matters
and communications issues; others have acted as “czars” for specific projects or
policy areas.

The most powerful senior advisers frequently have had a long personal relation-
ship with the President and often have spent a significant amount of time with him
within and outside of the White House. They have been asked not only to provide
guidance on a variety of policy issues, but also to offer instruction on communi-
cating with the American people and the media.

In anumber of Administrations, new offices—or “councils”—have been created
to support senior advisers. For the most part, their functions have been duplicative
or overlapping, as a result of which these offices have tended to be short-lived. Even
so, senior advisers should be provided the staff and resources that their portfo-
lios require. To ensure that senior advisers are effective, their portfolios must be
clearly delineated and clearly communicated across the White House. This too is
a responsibility of the Chief of Staff.

OFFICE OF WHITE HOUSE COUNSEL

The Office of White House Counsel provides legal guidance to the President and
elements of the EOP on a host of issues, including presidential powers and privi-
leges, ethics compliance, review of clemency applications, and judicial nominations.
The selection of White House Counsel is one of the most important decisions an
incoming President will make. The office is not designed to create or advance pol-
icies on its own initiative—nor should it do so. Rather, it is dedicated to guiding

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the President and his reports on how (within the bounds of the law) to pursue and
realize the President’s agenda.

While the White House Counsel does not serve as the President’s personal attor-
ney in nonofficial matters, it is almost impossible to delineate exactly where an
issue is strictly personal and has no bearing on the President’s official function. The
White House Counsel needs to be deeply committed both to the President’s agenda
and to affording the President proactive counsel and zealous representation. That
individual directly advises the President as he performs the duties of the office,
and this requires a relationship that is built on trust, confidentiality, and candor.

The Office of White House Counsel is also responsible for ensuring that each
component of the White House adheres to all applicable legal and ethical guide-
lines, which often requires ongoing training and monitoring to ensure compliance.
This means ensuring that White House staff regularly consult with office attor-
neys on required financial disclosures, received gifts, potential conflicts of interest,
and other ethical concerns. The Office of White House Counsel is the first line of
defense for the EOP. Its staff must take seriously the duty to protect the powers
and privileges of the President from encroachments by Congress, the judiciary,
and the administrative components of departments and agencies.

In addition to the White House Counsel, the office includes deputies, assistants,
associates, and legal support staff. The assistant and associate attorneys are often
specialists in particular areas of the law and offer guidance to the EOP on issues
related to national security, criminal law, environmental law, and a host of admin-
istrative and regulatory matters. Attorneys working in the Office of White House
Counsel serve as legal advisers to the White House policy operation by reviewing
executive orders, agency regulations, and other policy-related functions. Here
again, subordinates should be deeply committed to the President’s agenda and
see their role as helping to accomplish the agenda through problem solving and
advocacy. They should not erect roadblocks out of an abundance of caution; rather,
they should offer practical legal advice on how to promote the President’s agenda
within the bounds of the law.

The White House Counsel’s office cannot serve as a finishing school to credential
the next set of white-shoe law firm attorneys or federal judges in waiting who cabin
their opinions for fear their elite credentials could be tarnished through a policy
disagreement. Rather, it should function more as an activist yet ethical plaintiffs’
firm that advocates for its client—the Administration’s agenda—within the limits
imposed by the Constitution and the duties of the legal profession.

The Office of White House Counsel also serves as the primary gateway for
communication between the White House and the Department of Justice (DOJ).
Traditionally, both the White House Counsel and the Attorney General have issued
amemo requiring all contact between the two institutions to occur only between
the Office of White House Counsel and the Attorney General or Deputy Attorney

Mandate for Leadership: The Conservative Promise

General. The next Administration should reexamine this policy and determine
whether it might be more efficient or more appropriate for communication to occur
through additional channels. The White House Counsel also works closely with
the DOJ Office of Legal Counsel to seek opinions on, for example, matters of policy
development and the constitutionality of presidential power and privileges and
with OLA and the DOJ Office of Legal Policy on presidential judicial nominees.

When anew President takes office, he will need to decide expeditiously how to
handle any major ongoing litigation or other pending legal matters that might pres-
ent a challenge to his agenda. To offer guidance, the White House Counsel must get
up to speed as quickly as possible on all significant ongoing legal challenges across
the executive branch that might affect the new Administration’s policy agenda and
must be prepared at the outset of the Administration to present recommenda-
tions to the President, including recommendations for reconsidering or reversing
positions of the previous Administration in any significant litigation. This review
will usually require consulting with the new political leadership at the Justice
Department, including during the transition period.

No day is predictable at the White House. Therefore, to handle the pace and
volatility of affairs, the Office of White House Counsel must offer measured legal
guidance in a timely manner. This often means forgoing law review-style memos
about esoteric legal concepts and instead quickly providing high-level yet incisive
guidance. Due to evolving world events, domestic affairs, and political pressures, the
office often faces legal questions for which there may not be a wealth of precedent.
Attorneys in the Office of White House Counsel must therefore work collaboratively
within the White House and the Department of Justice, relying on each other as a
team, to ensure that proper legal guidance is delivered to the President.

The President should choose a White House Counsel who is well-versed in
the Constitution, administrative and regulatory law, and the inner workings of
Congress and the political process. Instead of choosing a specialist, the President
should hire a counsel with extensive experience with a wide range of complex legal
subjects. Moreover, while a candidate with elite credentials might seem ideal, the
best one will be above all loyal to the President and the Constitution.

STAFF SECRETARY

The Office of the Staff Secretary is rarely visible to the outside world, but it
performs work of tremendous importance. The office is similar to a military com-
mander’s adjutant as it is responsible for fielding and managing a vast amount of
information at the top ofits organization. This includes information on its way into
the Oval Office as well as information flowing out from the Oval Office. Because
of its gatekeeping function, the position of Staff Secretary is one of extreme trust,
and the individual who possesses it should be vetted to work as an “honest broker”
in the President’s service.

2025 Presidential Transition Project

The Office of the Staff Secretary has been described as the last substantive
control point before papers reach the Oval Office. A great deal of information is
headed toward the Oval Office at any moment. This includes presidential decision
memos; bills passed by Congress (which may be accompanied by signing or veto
statements); and briefing books, reading materials, samples of constituent mail,
personal mail, and drafts of speeches. The Staff Secretary makes certain that these
materials are complete, well-ordered, and up to date before they reach the Presi-
dent. This necessarily means that the Staff Secretary plays a key role in determining
who weighs in on policy matters and when.

As noted above, the Staff Secretary also handles information leaving the Oval
Office. The President may have questions after reviewing incoming material, may
wish to seek more information, or may demand revisions. The Staff Secretary is
often responsible for directing these requests to the appropriate places and fol-
lowing up on them to ensure that they are completed.

One of the Staff Secretary’s critical functions is managing and overseeing the
clearance process for the President’s daily/nightly briefing book. This book is filled
with all the reading material and leading documentation the President needs in
the morning and the evening to help him make decisions. The Staff Secretary also
oversees the use of the President’s signature, whether by hand or by autopen, and
manages the Office of the Executive Clerk, Office of Records Management, and
Office of Presidential Correspondence.

OFFICE OF COMMUNICATIONS

The Office of Communications, which operates under the Director of Com-
munications, conveys the President’s agenda to the public through various media,
including speeches and remarks, press briefings, off-the-record discussions with
reporters, and social media. Depending on how a President chooses to structure
his White House, the Office of Communications may include the Office of the Press
Secretary (Press Office), but no matter how it is structured, the office must work
closely with the Press Office as well as the President’s speechwriters and digital
strategists.

Operational functions of the Office of Communications include scheduling and
running press briefings, interviews, meetings, media appearances, speeches, anda
range of other events. The Office of Communications must maintain robust rela-
tionships with the White House Press Corps, the White House Correspondents’
Association, regional stakeholders, and key interest groups. No legal entitle-
ment exists for the provision of permanent space for media on the White House
campus, and the next Administration should reexamine the balance between media
demands and space constraints on the White House premises.

Leadership within the Office of Communications should include a Com-
munications Director (who is a direct report to the Chief of Staff), a Deputy

Mandate for Leadership: The Conservative Promise

Communications Director, a Deputy Director for Strategic Communications, and
a Press Secretary. This leadership team must work together closely to drive the
national narrative about the White House.

The best resource for the Office of Communications is the President. The Pres-
ident conveys the White House’s overall message through one or two inaugural
addresses, State of the Union addresses, speeches to Congress, and press confer-
ences. The office must also ensure that the various White House offices disseminate
aunified message to the public. The Communications Director and Press Secretary
in particular should be careful to avoid contradicting the President or delivering
conflicting information.

The speechwriting team is a critical component of the communications team.
Speechwriting is a unique talent: The writers selected must understand policy,
should have a firm grasp of history and other liberal-arts disciplines, and should
be able to learn and adopt the President’s style of rhetoric and mode of delivery.

The Press Secretary is the President’s spokesperson, communicating to the
American people through the media. The Press Secretary engages with the White
House Press Corps formally through press briefings and informally through
impromptu gaggles and meetings. Individuals who serve in this role must be quick
on their feet, which means, when appropriate, deftly refuting and rebutting corre-
spondents’ questions and comments.

The Communications Director must convey the President’s mission to the
American people. Especially for conservatives, this means navigating the main-
stream media to ensure that the President’s agenda is conveyed effectively and
accurately. The Communications Director must be politically savvy and very aware
of the ongoing activities of the other White House offices. The new Administration
should examine the nature of the relationship between itself and the White House
Correspondents Association and consider whether an alternative coordinating
body might be more suitable.

OFFICE OF LEGISLATIVE AFFAIRS (OLA)

Created by President Dwight Eisenhower, the OLA has continued to serve as the
liaison between the White House and Congress. The White House must work with
congressional leaders to ensure presidential nominees, for roles such as Cabinet
secretaries and ambassadors, are confirmed by the Senate. The White House also
relies on Congress to enact reforms promised by the President on the campaign
trail, whether those promises relate to health care, education, or national defense.
Because Congress holds the power of the purse, White House staffers must ensure
that there is enough support on the Hill to secure the necessary funding through
the appropriations process to fulfill the President’s agenda.

The OLA reports directly to the Chief of Staff and in some Administrations has
done so under the guidance of a Deputy Chief of Staff (usually the Deputy Chief

2025 Presidential Transition Project

for Policy). Regardless of the person to whom the OLA reports, however, the office
exercises a certain autonomy on behalf of the President and the Chief of Staff in
directly influencing congressional leaders of both major political parties. The OLA
often must function as the mediator among the parties and find common ground
to facilitate the successful enactment of the President’s agenda.

As is the case with many White House offices (but especially the Office of Com-
munications), the OLA must ensure that congressional leaders receive one unified
message. If other actors within the White House maintain their own relationships
with congressional leaders and staffers, it may appear that the President’s agenda
is fractured and lacks consensus. This dynamic has caused real problems for many
Presidents in the past.

Internally, OLA staffers need to be involved in policy discussions, budget reviews,
and other important meetings. They must also provide advice to policy staffers
regarding whether certain ideas are politically feasible. Externally, OLA staffers
have to communicate continuously with congressional offices of both parties in
both the House and the Senate to ensure that the President has enough support
to enact his legislative priorities or sustain votes.

The OLA requires staffers who are effective communicators and can provide a
dose of reality to other White House staffers when necessary. Although a policy
proposal from within the White House may be a great idea, OLA staffers must
ensure that it is politically feasible. OLA staffers must therefore be skilled in both
politics and policy. Furthermore, the President should seek out individuals who
can advance his agenda and at the same time forge pathways with members of the
opposing political party on other priorities.

Most important, the OLA must function as a well-oiled machine: precisely
synced. The President cannot afford to have a tennis player on—much less as the
leader of—his football team.

OFFICE OF PRESIDENTIAL PERSONNEL (PPO)

The political axiom that “personnel is policy” was popularized under President
Ronald Reagan during the 1981 presidential transition. One of the most important
offices in the White House is the PPO, which was created under President Richard
Nixon to centralize political appointments. Departments and agencies had and still
have direct legal authority on hiring and firing, but the power to fill Schedule C posi-
tions—the core of political jobs—is vested with the President. Therefore, the White
House, not the department or agency, has the final word on political appointments.

PPO’s primary responsibility is to staff the executive branch with individuals
who are equipped to implement the President’s agenda. Although its focus should
be identifying and recruiting leaders to fill the approximately 1,000 appointments that
require Senate confirmation, PPO must also fill approximately 3,000 political jobs that
require dedicated conservatives to support the Administration’s political leadership.

—' 3) —

Mandate for Leadership: The Conservative Promise

Frequently, many medium-tier and top-tier jobs have been filled by policy

experts tasked with accomplishing much of the work of the Administration. At

the same time, appointees in the entry-level jobs have brought invaluable energy

and commitment to the White House and have proved to be the “farm team” for

the conservative movement.

The Office of Presidential Personnel is responsible for:

Identifying potential political personnel both actively through recruitment
and passively by fielding resumes and adjudicating requests from
political actors.

Vetting potential political personnel by conducting political background
checks and reviewing any clearance and fitness assessments by departments
and agencies.

Making recommendations to the President and to other appointment
authorities on behalf of the President.

Identifying programmatic political workforce needs early and developing
plans (for example, Schedule F).

Maintaining a strong relationship with the Office of Personnel Management
(OPM) both for operational purposes and to effectuate the President’s direct
Title 5 authorities. The President is in charge of the federal workforce and
exercises control principally by working through the Director of the Office
of Personnel Management.

Training and connecting political personnel.
Playing “bad cop” in a way that other White House offices cannot
(including serving as the office that takes direct responsibility for firings

and hirings).

Serving as a personnel link between conservative organizations and the
executive branch.

In most Administrations, PPO will staff more than 100 positions during a transi-

tion and thousands of noncareer positions during the President’s first term. Direct

authority and a strong relationship with the President are necessary attributes for

any PPO Director. Historically, PPO has had direct review and control of personnel

files, including security clearance dossiers.

2025 Presidential Transition Project

At the highest level, PPO is tasked with long-term, strategic workforce devel-
opment. The “billets” of political appointments are of immense importance in
credentialing and training future leaders. In addition, whatever one’s view of the
constitutionality of various civil service rules (for example, the Federal Vacancies
Reform Act of 1998°) might be, it is necessary to ensure that departments and
agencies have robust cadres of political staff just below senior levels in the event
of unexpected vacancies.

OFFICE OF POLITICAL AFFAIRS (OPA)

The OPA is the primary office within the executive branch for managing the
President’s political interests. Although its specific functions vary from Admin-
istration to Administration, the OPA typically serves as the liaison between the
President and associated political entities: national committees, federal and state
campaigns, and interest groups. Within legal guidelines, the OPA engages in out-
reach, conducts casework, and—if the President is up for reelection—assists with
his campaign. The OPA may also monitor congressional campaigns, arrange pres-
idential visits with other political campaigns, and recommend campaign staff to
the Office of Presidential Personnel for service in the executive branch.

The OPA further serves as a line of communication between the White House
and the President’s political party. This includes both relaying the President’s
ambitions to political interests and listening to the needs of political interests. This
relationship allows for the exchange of information between the White House and
political actors across the country. The OPA should have one director of political
affairs who reports either to the Chief of Staff or to a Deputy Chief of Staff. The
OPA should also include various deputy directors, each of whom is responsible for
a certain geographical region of the country.

Because nearly all White House activities are in some way inherently political,
the OPA needs to be aware of all presidential actions and activities—including
travel, policy decisions, speeches, nominations, and responses to matters of
national security—and consider how they might affect the President’s image. The
OPA must therefore have a designated staffer who communicates not only with
other White House offices, but also with the Cabinet and executive branch agencies.

OFFICE OF CABINET AFFAIRS (OCA)

The OCA’s role has changed to some degree over the course of various Adminis-
trations, but its overriding function remains the same: to ensure the coordination
of policy and communication between the White House and the Cabinet. Most
important, the OCA coordinates all Cabinet meetings with the President. It should
also organize and administer regular meetings of the Deputy Secretaries because
they also typically serve vital roles in the departments and agencies and, further,
often become acting secretaries when Cabinet members resign.

Mandate for Leadership: The Conservative Promise

There should be one Cabinet Secretary who reports to the Chief of Staff’s office,
either directly or through a deputy chief, according to the chief’s preference and
focus. The Cabinet Secretary maintains a direct relationship with all members of
the Cabinet.

The OCA further consists of deputies and special assistants who work with each
department’s principal, Deputy Secretary, Under Secretaries, Assistant Secretaries,
and other senior staff. The OCA also connects the departments to WHO offices.

The OCA coordinates with the Chief of Staff’s office and the Office of Communi-
cations to promote the President’s agenda through the Cabinet departments and
agencies. The Cabinet’s communications staffers are obviously another critical
component of this operation.

In prior Administrations, the OCA has played a vital role by tracking the Pres-
ident’s agenda for the Chief of Staff, Deputy Chiefs, and senior advisers. It has
worked with each department and agency to advance policy priorities. In the future,
amplifying this function would truly benefit both the President and the conser-
vative movement.

From time to time throughout an Administration, travel optics, ethics chal-
lenges, and Hatch Act’ issues involving Cabinet members, deputies, and senior
staffers can arise. The OCA is normally tasked with keeping the WHO informed
of such developments and providing support if and when necessary.

The ideal Cabinet Secretary will have exceptional organizational skills and be
a seasoned political operative or attorney. Because many Cabinet officials have
been former presidential candidates, governors, ambassadors, and Members of
Congress, the ideal candidate should also possess the ability to interact with and
persuade accomplished individuals.

OFFICE OF PUBLIC LIAISON (OPL)

The OPLis critically important in building coalitions and support for the Pres-
ident’s agenda across every aligned social, faith-based, minority, and economic
interest group. It is a critical tool for shaping public opinion and keeping myriad
supporters, as well as “frenemies” and opponents alike who are within reach,
better informed.

The OPLis a notably large office. It should have one Director who reports to the
Chief of Staff’s office, either directly or through a deputy, according to the chief’s
preference and focus. The Director must maintain relationships not only with
other WHO heads, but also with the senior staff of every Cabinet department and
agency. Since a President’s agenda is always in motion, it is important for the OPL
to facilitate listening sessions to receive the views of the various leaders and mem-
bers of key interest groups.

The OPL should also have a sufficient number of deputies and special assistants
to cover the vast number of disparate interest groups that are engaged daily. The

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2025 Presidential Transition Project

OPL has, by far, held more meetings in the Eisenhower Executive Office Building
(EEOB) and within the West Wing itself than any other office within the WHO.

The OPL is the chief White House enforcer and gatekeeper among these var-
ious interest groups. It has operated best whenever the Chief of Staff has given it
permission to use both the proverbial “carrot” and the proverbial “stick.” To make
this work, communication with the chief’s office is vital. Additionally, the OPL has
had an outsized role in presidential scheduling and both official and political travel.

The OPL Director should come from the President’s election campaign or Cap-
ito] Hill—but should not have deeply entrenched connections to a K Street entity
or any other potential stakeholder. Some prior relationships can create real or
perceived biases toward one group or another. The Director should be amiable,
gregarious, highly organized, and willing to shoulder criticism and pushback from
interest groups and other elements of the Administration.

Unlike the Director, OPL deputies and special assistants need a deep under-
standing of the capital, from K Street to Capitol Hill. They should have extensive
experience in private industry, the labor sector, the conservative movement, and
among the specific interest groups with which they will be asked to engage on
behalf of the White House.

OPL staffers work with more external and internal parties than any other WHO
staffers. In turn, they must be effective communicators and initiative-takers. They
must also be able to influence, persuade, and—most important—listen to various
stakeholders and ensure that they feel heard. All OPL staffers must understand
from the outset that their jobs might be modified or even phased out entirely as
the Administration’s priorities change.

OFFICE OF INTERGOVERNMENTAL AFFAIRS (IGA)

The IGA connects the White House to state, county, local, and tribal govern-
ments. In other words, it is the one-stop shop for disseminating an Administration’s
agenda to all non-federal government entities.

The IGA should have a Director to whom one or two Deputy Directors report.
The Director must ensure that the White House remains connected to all non-
federal government entities. The interests and perspectives of these entities are
represented in policy discussions, organized events with the West Wing, EOP
senior staff, and IGA staff throughout the departments and agencies.

The IGA can be staffed in a variety of ways, but two arrangements are
most common:

e Each deputy and that deputy’s staffers are responsible for a type of government.

e Agroup of staffers is responsible for a specific geographical region of
the country.

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Mandate for Leadership: The Conservative Promise

The IGA, as suggested above, represents the interests and perspectives of non-
federal government entities, but its primary job is to make sure that these entities
understand an Administration’s agenda and ultimately support it.

The IGA must work with all other White House offices, especially the OPA and
the OPL, and manage its staff throughout the departments and agencies. IGA staff-
ers must therefore have communication skills, understand political nuance, and
be willing to engage in complex policy discussions. They should also be not just
generally responsive, but also proactive in seeking out the interests and perspec-
tives of non-federal government entities.

WHITE HOUSE POLICY COUNCILS

As the federal government has ballooned in size over the past century, it has
become increasingly difficult for the President alone to direct his agenda across
the executive branch. Three White House policy councils have come into existence
to help the President to control the bureaucracy and ensure continued alignment
between agency leadership and White House priorities. Those councils—as pre-
viewed above—are the NSC, NEC, and DPC. Each is headed by an Assistant to the
President and performs three significant functions.

e Policy Coordination. The primary role of the policy councils is to
coordinate the development of Administration policy. This frequently
includes developing significant legislative priorities, coordinating policy
decisions that impact multiple departments and agencies, and at times
coordinating policy decisions within a single department or agency. This
process must ensure that all relevant offices are included; that competing
or conflicting opinions are thoroughly discussed and evaluated; and, when
there is disagreement among White House senior staff or among Cabinet
members, a well-structured question is presented to the President for an
intermediate or final decision.

e Policy Advice. By virtue of working in the White House, the heads of the
three policy councils will also function as independent policy advisers to
the President. This aspect of the role will vary depending on the individual
in this position and the President’s governing philosophy. Incumbents have
ranged from “honest brokers,” who mostly coordinate and ensure that all
opinions are fairly presented to the President, to “policy deciders,” who
largely drive a given policy topic on behalf of the President.

e Policy Implementation. The policy councils also manage and mediate

the implementation of previous policy decisions. Implementation of a new
statute or an executive order frequently takes years and involves many

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2025 Presidential Transition Project

distinct and more granular policy decisions along the way. It is essential
to have a centralized process for evaluating and coordinating these
decisions, especially if they involve more than one Cabinet department
or agency with differing opinions on the best approach for securing the
President’s goals.

The above functions have recently been managed by policy councils through
a tiered interagency policy process. This process helps to identify differences of
opinion and reach a decision without having to take every issue to the President. It
can be used to address a single question or monitor a recurring issue on an ongoing
basis. Typically, the process involves multiple Cabinet departments and agencies
that have a pertinent role, policy interest, or disagreement. Each policy council’s
process could involve the following committees:

e Policy Coordinating Committee (PCC). A PCC is led by a Special
Assistant to the President from the policy council and includes political
Assistant Secretary-level experts from the relevant departments,
agencies, or offices. The purpose is to determine where consensus exists,
clearly identify where there are differing opinions, and develop options
for resolving the remaining questions. If no outstanding questions or
disagreements exist, the PCC may resolve the issue and move toward
implementation at the agency level.

e Deputies Committee (DC). A DC is a meeting of presidentially appointed
executives chaired by the policy council’s Deputy Assistant to the President
and relevant Deputy Secretaries. It evaluates the options produced by the
PCC and frequently directs the PCC to add, expand, or reevaluate an option
or even to reach a compromise and resolve an issue at that level.

e Principals Committee (PC). When questions are not resolved by a DC,
the Director of the Policy Council will chair a PC, which is attended by the
relevant Cabinet Secretaries and senior White House political staff. This is
the final opportunity for the President’s most senior advisers to discuss the
question, make sure that each principal’s position is carefully understood,
and see whether consensus or a compromise might be reached. If not,
the Chief of Staff’s office will schedule time for the PC to meet with the
President for a final decision.

Despite having seemingly clear and separate portfolios, the three policy coun-

cils frequently have areas of overlap, which can result in confusion, duplication,
or conflict. For example, there are the areas of immigration and border security

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Mandate for Leadership: The Conservative Promise

(either NSC or DPC); health care, energy, and environment (either NEC or DPC);
and trade and international economic policy (either NSC or NEC). Identifying
these potentially problematic areas and assigning policy responsibilities to only
one council where possible will help to speed up the policy-coordination process.

While other chapters will cover specific policy goals for each department or
agency, incoming policy councils will need to move rapidly to lead policy processes
around cross-cutting agency topics, including countering China, enforcing immi-
gration laws, reversing regulatory policies in order to promote energy production,
combating the Left’s aggressive attacks on life and religious liberty, and confronting

“wokeism” throughout the federal government.

National Security Council. The NSC is intended to be an interdepartmen-
tal body within the White House that can set national security policy with a
whole-of-government approach. Unlike the other policy councils, the NSC was
established by statute.’ Statutory members and advisers who are currently part of
the NSC include the President and Vice President; the Secretaries of State, Defense,
and Energy; the Chairman of the Joint Chiefs of Staff; and the Director of National
Intelligence.°

The NSC staff, and particularly the National Security Adviser, should be
vetted for foreign and security policy experience and insight. The National Secu-
rity Adviser and NSC staff advise the President on matters of foreign policy and
national security, serve as an information conduit in times of crisis, and as liaisons
ensuring that written communications are properly shared among NSC members.

Special attention should be given to the use of detailees to staff the NSC. In
recent years, the NSC’s staff size has been rightsized from its peak of 400 in 2015
down to 100-150 professional members. The next Administration should try to
limit the number of detailees to ensure more direct presidential control.

National Economic Council. The NEC was established in 1993 by executive
order and has four key functions:

e To “coordinate the economic policy-making process with respect to
domestic and international economic issues.”

e To “coordinate economic policy advice to the President.”

e To “ensure that policy decisions and programs are consistent with the
President’s stated goals” and “that those goals are being effectively pursued.”

e To “monitor implementation of the President’s economic policy agenda.”
The NEC Director coordinates and implements the President’s economic policy

objectives by working with Cabinet secretaries, their departments, and multiple

2025 Presidential Transition Project

agencies. The Director is supported by a staff of policy experts in various fields,
including infrastructure, manufacturing, research and development, agriculture,
small business, financial regulation, housing, technology and innovation, and
fiscal policy.

The NEC considers economic policy matters, and the DPC typically considers
anything related to domestic matters with the exception of economic policy mat-
ters. It also differs from the Council of Economic Advisers (CEA). Whereas the
NEC is in charge of policy development, the CEA acts as the White House’s internal
research arm for economic analysis.

It is therefore critically important to find people with the right qualifica-
tions to head both the NEC and the CEA. The CEA is almost always led by a
well-known academic economist, and the NEC is regularly led by someone with
expertise in directing the President’s economic policy process. Those who have
served in the role have ranged from former CEOs of the nation’s largest invest-
ment firms to financial-services industry managers to seasoned congressional
staffers who have managed the economic policy issues for top financial and
tax-writing committees.

Domestic Policy Council. The Domestic Policy Council (DPC) consists of
advisers to the President on noneconomic domestic policy issues as well as inter-
national issues with a significant domestic component (such as immigration). It is
one of the primary policy councils serving the President along with the NSC and
NEC. The Director serves as the principal DPC adviser to the President, along with
members of the Cabinet, and the Deputy Director chairs the committee respon-
sible for coordinating domestic policy development at the Deputy Secretary level.
In this respect, both the Director and the Deputy Director have critical institu-
tional functions that affect the development of domestic policy throughout the
Administration.

The DPC also has policy experts (for example, Special Assistants to the Presi-
dent or SAPs) who are responsible for developing and coordinating, as well as for
advising the President, on specific issues. It is essential that DPC policy expertise
reflect the most prominent issues that are before the Administration: issues such
as the environment, health care, housing, and immigration. In addition, DPC SAPs
should demonstrate a working knowledge of the rulemaking process (although
they need not necessarily be experts on regulation) because a working knowledge
of the rulemaking process will facilitate the DPC’s effectiveness in coordinating
Administration policy.

The DPC also needs to work closely with other offices within the Executive
Office of the President to promote economic opportunity and private-sector inno-
vation. This includes working with the Office of Management and Budget and its
Office of Information and Regulatory Affairs as well as the Council of Economic
Advisers, Council on Environmental Quality, and Office of Science and Technology

Mandate for Leadership: The Conservative Promise

Policy. To this end, the Director should chair a standing meeting with the princi-
pals from each of the other EOP offices to enhance coordination from within the
White House.

Several areas will be especially important as the DPC works to develop a
well-defined domestic policy agenda. One is the promotion of innovation as a
foundation for economic growth and opportunity. The President should establish
an economic opportunity working group, chaired by the DPC Director, to coordi-
nate the development of policies that promote economic opportunity. Another
important area is the promotion of health care reform to bring down costs for the
American people and the pressure that spending on health programs puts on the
federal budget. Finally, DPC should coordinate with the NSC on a policy agenda
to enhance border security.

OFFICE OF THE VICE PRESIDENT (OVP)

In modern U.S. history, the Vice President has acted as a significant adviser to
the President. Once elected, the VP helps to promote and, in many instances, put
into place and execute the President’s agenda. The President may additionally
determine the inclusion of OVP staff in White House meetings, including Policy
Coordinating Committee, Deputies Committee, and Principals Committee dis-
cussions as has been done in various recent Administrations.

Recent Presidents have decided to give Vice Presidents space in the West Wing.
The VP’s proximity to the President—as well as to the Chief of Staff and additional
senior advisers—makes his or her role a powerful one within the West Wing.

Presidents typically tap VPs to lead various Administration efforts. These efforts
have included serving on the NSC Principals Committee, heading the National
Space Council, addressing immigration and border issues, leading the response
to health care crises, and supervising workforce programs. VPs traditionally also
spearhead projects of personal interest that have been authorized by the President.

The VP is also charged with breaking tie votes in the Senate and in recent years
has served abroad as a brand ambassador for the White House and more broadly
the United States, announcing Administration priorities and coordinating with
heads of state and other top foreign government officials. The Vice President, as
President of the Senate, could be a President’s emissary to the Senate.

OFFICE OF THE FIRST LADY/FIRST GENTLEMAN

The First Lady or First Gentleman plays an interesting role in the formation,
implementation, and execution of policy in concert with the President. Active
and interested first spouses often champion a select number of signature issues,
whether they be thorny social issues or deeper policy issues. One advantage of the
first spouse’s taking on hot-button social issues is that any political backlash will
be less severe than it would be for the President.

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2025 Presidential Transition Project

The first spouse normally appoints a chief of staff who has enough assistants
to support the spouse’s activities in the East Wing of the White House. This group
works exclusively with the first spouse and senior members of the White House
along with EOP personnel to implement and execute the first spouse’s priorities,
which reflect the first spouse’s passions and interests and are often identified as
important in discussions with the President. Executed well, they can be strategi-
cally useful in accelerating the Administration’s agenda. Past East Wing initiatives
have focused on such issues as combating bullying, fighting drug abuse, promoting
literacy, and encouraging physical education for young adults and children.

The first spouse is afforded significant resources. His or her staff also works with
the President’s policy team, members of the Cabinet, and other EOP staff.

AUTHOR’S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but Edwin
Meese Ill, Donald Devine, Ambassador Andrew Bremberg, and Jonathan Bronitsky deserve special mention. The
author alone assumes responsibility for the content of this chapter, and no views expressed herein should be
attributed to any other individual.

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Mandate for Leadership: The Conservative Promise

ENDNOTES

2. US. Constitution, art. I, § 2.

3. US. Constitution, art. II, § 3.

4, U.S. Constitution, art. Il, § 2.

5. See Chapter 2, “Executive Office of the President,” infra.
6. H.R. 4328, Omnibus Consolidated and Em

277, 105th Congress, October 21, 1998, Di
PLAW-105publ277.pdf (accessed Februa
7. §.1871, An Act to Prevent Pernicious Poli

s3.amazonaws.com/legislink/pdf/stat/6
Security Council was established by the

https://govtrackus.s3.amazonaws.com/legis
8. §. 758, National Security Act of 1947, Publi
/STATUTE-61-Pg495.pdf
ional Security Act of 1947 (P

tica

amended by the National Security Act A

as part of the Reorganization Plan, the Coun
House, “National Security Council,” https://www.whitehouse.gov/
9. See Chapter 2, “Executive Office of the Presi
10. President William J. Clinton, Executive Order 12835, “Establishme

cil was placed in the

dent,” infra.

January 25, 1993, in Federal Register, Vol. 58, No. 16 January 27,
gov/content/pkg/FR-1993-01-27/pdf/FR-1993-01-27.df (accessed March 7, 2023).

—47 —

Execut

U.S. Constitution, art. Il, § 1, httos://constitution.congress.gov/constitution/article-2/ (accessed February 14, 2023).

ergency Supplemental Appropriations Act, 1999, Public Law No. 105-
ision C, Title |, § 151, httos://www.congress.gov/105/plaws/publ277/
ry 15, 2023).
Activities, Public Law No. 76-252, 76th Congress, August 2, 1939,
ink/pdf/stat/53/STATUTE-53-Pgl147.pdf (accessed March 7, 2023).
c Law No. 80-253, 80th Congress, July 26, 1947, https://govtrackus.
accessed February 15, 2023). “The National

L 235 - 61 Stat. 496; U.S.C. 402),

mendments of 1949 (63 Stat. 579; 50 U.S.C. 401 et seq.). Later in 1949,

ive Office of the President.” The White

nsc/ (accessed February 15, 2023).

nt of the National Economic Council,”
993), pp. 6189-6190, https://www.govinfo.

EXECUTIVE OFFICE

OF THE PRESIDENT

OF THE UNITED STATES
Russ Vought

n its opening words, Article II of the U.S. Constitution makes it abundantly

clear that “[t]he executive power shall be vested in a President of the United

States of America.”! That enormous power is not vested in departments or
agencies, in staff or administrative bodies, in nongovernmental organizations or
other equities and interests close to the government. The President must set and
enforce a plan for the executive branch. Sadly, however, a President today assumes
office to find a sprawling federal bureaucracy that all too often is carrying out its
own policy plans and preferences—or, worse yet, the policy plans and preferences
of a radical, supposedly “woke” faction of the country.

The modern conservative President’s task is to limit, control, and direct the
executive branch on behalf of the American people. This challenge is created
and exacerbated by factors like Congress’s decades-long tendency to delegate its
lawmaking power to agency bureaucracies, the pervasive notion of expert “inde-
pendence” that protects so-called expert authorities from scrutiny, the presumed
inability to hold career civil servants accountable for their performance, and the
increasing reality that many agencies are not only too big and powerful, but also
increasingly weaponized against the public and a President who is elected by the
people and empowered by the Constitution to govern.

In Federalist No. 47, James Madison warned that “[t]he accumulation of all powers,
legislative, executive, and judiciary, in the same hands, whether of one, a few, or many,
and whether hereditary, self-appointed, or elective, may justly be pronounced the
very definition of tyranny.”’ Regrettably, that wise and cautionary note describes
to a significant degree the modern executive branch, which—whether controlled

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Mandate for Leadership: The Conservative Promise

by the bureaucracy or by the President—writes federal policy, enforces that policy,
and often adjudicates whether that policy was properly drafted and enforced. The
overall situation is constitutionally dire, unsustainably expensive, and in urgent need
of repair. Nothing less than the survival of self-governance in America is at stake.

The great challenge confronting a conservative President is the existential need
for aggressive use of the vast powers of the executive branch to return power—
including power currently held by the executive branch—to the American people.
Success in meeting that challenge will require a rare combination of boldness and
self-denial: boldness to bend or break the bureaucracy to the presidential will and
self-denial to use the bureaucratic machine to send power away from Washington
and back to America’s families, faith communities, local governments, and states.

Fortunately, a President who is willing to lead will find in the Executive Office
of the President (EOP) the levers necessary to reverse this trend and impose a
sound direction for the nation on the federal bureaucracy. The effectiveness of
those EOP levers depends on the fundamental premise that it is the President’s
agenda that should matter to the departments and agencies that operate under his
constitutional authority and that, as a general matter, it is the President’s chosen
advisers who have the best sense of the President’s aims and intentions, both with
respect to the policies he intends to enact and with respect to the interests that
must be secured to govern successfully on behalf of the American people. This
chapter focuses on key features of and recommendations for several of the EOP’s
important components.

U.S. OFFICE OF MANAGEMENT AND BUDGET (OMB)

OMB assists the President in the execution of his policy agenda across the gov-
ernment by employing many statutory and executive procedural levers to bring
the bureaucracy in line with all budgetary, regulatory, and management decisions.
Properly understood, it is a President’s air-traffic control system with the abil-
ity and charge to ensure that all policy initiatives are flying in sync and with the
authority to let planes take off and, at times, ground planes that are flying off course.
OMB’s key roles include:

e Developing and enforcing the President’s budget and executing the
appropriations laws that fund the government;

e Managing agency and personnel performance, procurement policy,
financial management, and information technology;

e Developing the President’s regulatory agenda, reviewing new regulatory

actions, reviewing federal information collections, and setting and enforcing
federal information policy; and

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2025 Presidential Transition Project

e Coordinating and clearing agency communications with Congress,
including testimonies and views on draft legislation.

OMB cannot perform its role on behalf of the President effectively if it is not inti-
mately involved in all aspects of the White House policy process and lacks knowledge
of what the agencies are doing. Internally to the EOP, ensuring that the policy-for-
mulation procedures developed by the White House to serve the President include
OMBis one of any OMB Director’s major responsibilities. A common meme of those
who intend to evade OMB review is to argue that where “resources” are not being
discussed, OMB’s participation is optional. This ignores both OMB’s role in all down-
stream execution and the reality that it has the only statutory tools in the White
House that are powerful enough to override implementing agencies’ bureaucracies.

The Director must view his job as the best, most comprehensive approxima-
tion of the President’s mind as it pertains to the policy agenda while always being
ready with actual options to effect that agenda within existing legal authorities and
resources. This role cannot be performed adequately if the Director acts instead as
the ambassador of the institutional interests of OMB and the wider bureaucracy
to the White House. Once its reputation as the keeper of “commander’s intent”
is established, then and only then does OMB have the ability to shape the most
efficient way to pursue an objective.

Externally, the Director must ensure that OMB has sufficient visibility into
the deep caverns of agency decision-making. One indispensable statutory tool to
that end is to ensure that policy officials—the Program Associate Directors (PADs)
managing the vast Resource Management Offices (RMOs)—personally sign what
are known as the apportionments. In 1870, Congress passed the Anti-Deficiency
Act* to prevent the common agency practice of spending down all appropriated
funding, creating artificial funding shortfalls that Congress would have to fill. The
law mandated that all funding be allotted or “apportioned” in installments. This
process, whereby agencies come to OMB for allotments of appropriated funding, is
essential to the effective financial stewardship of taxpayer dollars. OMB can then
direct on behalf of a President the amount, duration, and purpose of any appor-
tioned funding to ensure against waste, fraud, and abuse and ensure consistency
with the President’s agenda and applicable laws.

The vast majority of these apportionments were signed by career officials—the
Deputy Associate Directors (DADs)—until the Trump Administration placed this
responsibility in the hands of the PADs and thereby opened wide vistas of oversight
that had escaped the attention of policy officials. The Biden Administration sub-
sequently reversed this decision. No Director should be chosen who is unwilling
to restore apportionment decision-making to the PADs’ personal review, who is
not aggressive in wielding the tool on behalf of the President’s agenda, or who is
unable to defend the power against attacks from Congress.

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Mandate for Leadership: The Conservative Promise

It should be noted that each of OMB’s primary functions, along with other
executive and statutory roles, is carried out with the help of many essential OMB
support offices. The two most important offices for moving OMB at the will ofa
Director are the Budget Review Division (BRD) and the Office of General Counsel
(OGC). The Director should have a direct and effective relationship with the head
of the BRD (considered the top career official within OMB) and transmit most
instructions through that office because the rest of the agency is institution-
ally inclined toward its direction and responds accordingly. The BRD inevitably
will translate the directions from policy officials to the career staff, and at every
stage, it is obviously vital that the Director ensure that this translation is an
accurate one.

In addition, many key considerations involved in enacting a President’s agenda
hinge on existing legal authorities. The Director must ensure the appointment
of a General Counsel who is respected yet creative and fearless in his or her abil-
ity to challenge legal precedents that serve to protect the status quo. This is vital
within OMB not only with respect to the adequate development of policy options
for the President’s review, but also with respect to agencies that attempt to protect
their own institutional interests and foreclose certain avenues based on the mere
assertion (and not proof) that the law disallows it or that, conversely, attempt to
disregard the clear statutory commands of Congress.

In general, the Director should empower a strong Deputy Director with author-
ity over the Deputy for Management, the PADs, and the Office of Information and
Regulatory Affairs (OIRA) to work diligently to break down barriers within OMB
and not allow turf disputes or a lack of visibility to undermine the agency’s prin-
cipal budget, management, and regulatory functions. OMB should work toward a

“One OMB” position on behalf of the President and represent that view during the
various policymaking processes.

Budget. The United States today faces an untenable fiscal situation and owes
$31 trillion on a debt that is steadily increasing. The OMB Director should present
a fiscal goal to the President early in the budget development process to address
the federal government’s fiscal irresponsibility. This goal would help to align the
months-long process of developing the actual proposals for inclusion in the budget.

Though some mistakenly regard it as a mere paper-pushing exercise, the Pres-
ident’s budget is in fact a powerful mechanism for setting and enforcing public
policy at federal agencies. The budget team includes six Resource Management
Offices that, together with the BRD and other components, help the Director of
OMB to develop and execute detailed agency spending plans that bear on every
major aspect of policy formation and execution at federal agencies. Through initial
priority-setting and ongoing supervision of agency spending, OMB’s budget team
plays a key role in executing policy across the executive branch, including at many
agencies wrongly regarded as “independent.”

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2025 Presidential Transition Project

The RMOs, each of which is led by a political appointee known as the PAD and
acareer DAD, are separated into six functional units:

e National Security.

e Natural Resources, Energy, and Science.

e Health.

e Education, Income Maintenance, and Labor.

e Transportation, Justice, and Homeland Security.
e Treasury, Commerce, and Housing.

Because the RMOs are institutionally ingrained in nearly all policymaking and
implementation across the executive branch, they play a critical role in helping the
Director to implement the President’s public policy agenda. However, because each
RMO is responsible for formulating and supervising such a wide range of policy
details, many granular but critical policy decisions are effectively left to the career
professionals who serve across Administrations.

To enhance the OMB Director’s ability to help the President drive policy at the
agencies, the existing six RMOs should be divided into smaller subject-matter areas,
allowing for more PADs, and each of these PADs should have a Deputy PAD. This
expanded pool of RMOs with additional political leadership would enable more
comprehensive direction and oversight of policy development and implementation.

Regardless of whether Congress adopts the President’s full set of budget rec-
ommendations, the President should reintroduce the concept of administrative
pay-as-you-go, or administrative PAYGO. This simple procedural requirement
imposes budget neutrality on the discretionary choices of federal agencies, of
which there are many in nearly all areas of policymaking. This simple step forces
the executive branch to control what it can control. The principle may occasionally
yield to other overarching requirements, such as a presidential regulatory budget,
but in nearly all cases, administrative PAYGO plays a unique and indispensable
role in enforcing fiscal responsibility at federal departments and agencies.

The President should use every possible tool to propose and impose fiscal disci-
pline on the federal government. Anything short of that would constitute abject failure.

Management. The Management Office of OMB (the “M-Side” as it is often
called) is responsible for carrying out several important agency oversight functions,
many of which are statutory. The Management team includes the following offices
led by presidentially appointed Senate-confirmed individuals:

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Mandate for Leadership: The Conservative Promise

e ~The Office of Federal Procurement Policy (OF PP).

e The Office of Performance and Personnel Management (OPPM).
e The Office of Federal Financial Management (OFFM).

e = The Office of the Federal Chief Information Officer (OFCIO).

e The Made in America Office (MIAO), which was added by the Biden
Administration and is not a Senate-confirmed slot.

Each of these offices has responsibilities and authorities that a President can
use to help drive policy across the government. It is vital that the Director and his
political staff, not the careerists, drive these offices in pursuit of the President’s
actual priorities and not let them set their own agenda based on the wishes of the
sprawling “good government” management community in and outside of govern-
ment. Many Directors do not properly prioritize the management portfolio, leaving
it to the Deputy for Management, but such neglect creates purposeless bureaucracy
that impedes a President’s agenda—an “M Train to Nowhere.”

OFPP. This office plays a critical role in leading the development of new policies
and regulations concerning federal contracting and procurement. Through the
Federal Acquisition Regulatory Council, which is generally chaired by the OFPP
Administrator, OFPP helps the Director to set a wide range of policies for all of
those who contract with the executive branch. In the past, those governmentwide
contracting rules have played a key role in helping to implement the President’s
policy agenda. This office should be engaged early and often in OMB’s effort to drive
policy, including by obtaining transparency about entities that are awarded federal
contracts and grants and by using government contracts to push back against woke
policies in corporate America.

OPPM. Through this office, the Director helps federal agencies to establish their
performance goals and performance review processes. OPPM also works with the
USS. Office of Personnel Management (OPM) to establish and manage personnel
policies and practices across the federal government. The Director should instruct
OPPM to establish annual performance goals and review processes for agencies
that reflect the President’s agenda. OPPM should also be part of the President’s
strategy to set and enforce sensible policies and practices for the federal workforce.

OFFM. This office helps the Director to root out waste, fraud, and abuse in fed-
eral programs—for example, through the Do Not Pay program. It should be part of
efforts to save precious taxpayer resources.

OF CIO. This office guides the federal government’s use and adoption of Inter-
net-based technologies to improve government operations and save taxpayer

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2025 Presidential Transition Project

money. As a function of its leadership role, it is critical in interagency discussions
on a wide range of technology issues. The office thus is an important part of the
President’s efforts to modernize, strengthen, and set technology-adoption policy
for the executive branch.

MIAO. Building on the example and work of the Trump Administration, Presi-
dent Biden established this office to centralize, carry out, and further develop the
federal government’s Buy-American and other Made-in-America commitments.
Its work ought to be continued and further strengthened.

Regulatory and Information Policy. OMB’s OIRA plays an enormous and
vital role in reining in the regulatory state and ensuring that regulations achieve
important benefits while imposing minimal burdens on Americans. The President
should maintain Executive Order (EO) 12866,’ the foundation of OIRA’s review
of regulatory actions. The Administration should likewise maintain the recent
extension of those standards to regulatory actions of the U.S. Department of the
Treasury.° Regulatory analysis and OIRA review should also be required of the
historically “independent” agencies as the Office of Legal Counsel has found is
legally permissible.°

If the current Administration proceeds with its declared intent to modify
aspects of EO 12866 or review OMB Circular A-4,’ the related document that
provides the foundation for cost-benefit analysis, the next President should imme-
diately begin to undo those changes and develop a rigorous, data-driven approach
that will result in the least burdensome rules possible. The next President should
also revive the directive in Executive Order 13891* that significant guidance doc-
uments also must pass through OIRA review.

Because OIRA review often leads to fewer regulatory burdens, more regulatory
benefits, and better coordination of regulatory policy, funding for OIRA tends to
pay large dividends. Yet over the years, funding for OIRA has diminished. This
trend should be reversed. The budget should also include sufficient full-time equiv-
alent (FTE) employees to form regulatory advance teams that would consult with
agencies on cost-benefit analysis and good regulatory practices at the beginning
of the rulemaking process for the most important regulations. These teams would
help agencies take cost-benefit analysis into account from the beginning of their
rulemaking efforts, which in turn would result in higher-quality regulations anda
swifter eventual OIRA review. To preserve the integrity of OIRA review, the staff
who consult at the beginning of arulemaking should not handle its eventual review.

The next President should also reinstate the many executive orders signed
by President Trump that were designed to make the regulatory process more
just, efficient, and transparent. Executive Orders 13771,° 13777,” 13891," 13892,”
13893, 13924 Section 6," 13979, and 13980"° should be revived (with modifica-
tions as needed). Executive Order 13132” on federalism should be strengthened
so that state regulatory and fiscal operations are not commandeered by the federal

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Mandate for Leadership: The Conservative Promise

government through so-called cooperative federalism programs. Additionally, the
President should revise and sign an updated version of President Ronald Reagan’s
Executive Order 12630" on federal takings.

The next President should strengthen implementation of the Information Qual-
ity Act,’ robustly use the authority of the Paperwork Reduction Act,”° carefully
enforce the Privacy Act,” and ensure the sound execution of OIRA’s statistical
and other information policy functions. Regulatory cooperation agreements can
also promote the further adoption of good regulatory practices, which improve
market conditions for America and her allies. OIRA should also work with other
components of OMB to revise and apply OMB’s uniform Guidance for Grants and
Agreements” and ensure that federal contract and grant guidelines satisfy EO
12866 and other centralized standards as appropriate.

But executive reforms and actions, while vital, are not enough: Congress also
must act. The next President should work with Congress to pass significant reg-
ulatory policy and process reforms, which could go a long way toward reining in
the administrative state. Excellent examples of such legislation include the Reg-
ulatory Accountability Act,?? SMART Act,?* GOOD Act,” Early Participation in
Regulations Act,?° Unfunded Mandates Accountability and Transparency Act,”’
and REINS Act.”8

Finally, the next President should work with Congress to maximize the utility
of the Congressional Review Act (CRA),”’ which allows Congress to undo midnight
regulatory actions (including those disguised as “guidance”) on an accelerated
timeline. To leverage the CRA’s power to the maximum extent, Congress and
the President should enact the Midnight Rules Relief Act,*° which would help to
ensure that multiple regulatory actions could be packaged and voted on at the same
time. Immediate and robust use of the CRA would allow the President to focus
his rulemaking resources on major new regulatory reforms rather than devoting
months or years to undoing the final rulemakings of the Biden Administration.

Legislative Clearance and Coordination. OMB plays a critical role in ensur-
ing that the executive branch is aligned on legislative proposals and language,
agency testimonies, and other communications with Congress. The Director should
use these authorities to enforce policy and message consistency aggressively and
promote the effective engagement of the executive branch in legislative processes.

NATIONAL SECURITY COUNCIL (NSC)

The National Security Council (NSC) was established by statute to support the
President in developing and implementing national security policy by coordinating
across relevant departments and agencies, integrating authorities and resources
toward common ends, and objectively assessing progress toward established
goals. Led by the National Security Advisor (NSA), the NSC staff will be success-
ful in implementing the President’s national security goals only if it is made up

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2025 Presidential Transition Project

of personnel with technical expertise and experience as well as an alignment to
the President’s declared national security policy priorities. The NSC must then
chart a course that articulates and achieves the President’s national security goals
and objectives. The President should empower a strong NSC that not only has the
power to convene the policy process, but also is entrusted with the full power of
the presidency to drive the bureaucracy.

In organizing (by means of Presidential Directive*) an NSC staff that is more
responsive and aligned with the President’s goals and empowered to implement
them, the NSA should immediately evaluate and eliminate directorates that are
not aligned with the President’s agenda and replace them with new directorates as
appropriate that can drive implementation of the President’s signature national
security priorities. In addition to realigning the staff organization to the President’s
priorities, the NSA should assign responsibility for implementation of specific
policy initiatives to senior NSC officials from across the NSC staff structure. These
officials should develop, direct, and execute tangible action plans in coordination
with multiple agencies to achieve measurable, time-defined milestones.

Aligning NSC staff to the President’s national security goals will provide clearer
direction, a mandate for action, and a baseline of accountability that can be used
to evaluate staff performance and the NSC’s overall progress. Accountable senior
officials, themselves either political appointees or a minimum number of career
detailees, who are selected and vetted politically and report directly to political
staff should be the main day-to-day managers for interagency coordination and
implementation of their assigned national security policy objectives. They should
provide policy analysis for consideration by the broader NSC and relevant agencies
and ensure timely responses to decisions made by the President. The accountable
senior officials should be established at the direction of the NSA and draw on per-
sonnel and expertise from beyond the NSC, including OMB, the National Economic
Council, and relevant federal agencies.

The NSC staff and principals should work in tandem with the National Eco-
nomic Council and OMB at all levels, presenting a united effort to achieve the
President’s goals and drawing on the latter’s statutory authorities to guide the
bureaucracy. To accomplish national objectives effectively, foreign policy should
fully incorporate the economic instruments of national power. National security
policy must also include the prioritized allocation of resources. When policies are
divorced from the resources required to implement them, they are stillborn—aca-
demic exercises that undermine our national security and leave departments and
agencies to their own devices.

The accountable senior officials should be empowered to identify, recruit, clear,
and hire staff who are aligned with and willing to shepherd the President’s national
security priorities. NSC staff leads, under the direction of the NSA, should have
the discretion to reduce the number of positions that need high-level clearances,

Mandate for Leadership: The Conservative Promise

and the NSC should be adequately resourced and authorized to adjudicate and
hold security clearances internally with investigators who work directly for the
NSC and whose sole task is to clear NSC officials. If certain staff are determined
not to need high-level clearances, the question becomes whether they should be
part of the NSC at all.

The NSC should take a leading role in directing the drafting and thorough review
of all formal strategies: the National Security Strategy, the National Defense Strat-
egy, the Nuclear Posture Review, the Missile Defense Strategy, etc. In particular,
the National Defense Strategy, which by tradition has evaded significant review,
should be prioritized for White House review by the NSC and OMB. Both should
also conduct reviews of operational war plans and global force planning and allo-
cations with the Secretary of Defense to align them with presidential priorities and
review all key policy and guidance intended for implementation by the heads of the
Department of Defense, the Department of State, and the Intelligence Community
before they are authorized for distribution. The NSC should rigorously review all
general and flag officer promotions to prioritize the core roles and responsibilities
of the military over social engineering and non-defense matters, including climate
change, critical race theory, manufactured extremism, and other polarizing policies
that weaken our armed forces and discourage our nation’s finest men and women
from enlisting to serve in defense of our liberty.

The NSC staff will need to consolidate the functions of both the NSC and the
Homeland Security Council (HSC), incorporate the recently established Office of
the National Cyber Director, and evaluate the required regional and functional
directorates. Given the aforementioned prerequisites, the NSC should be prop-
erly resourced with sufficient policy professionals, and the NSA should prioritize
staffing the vast majority of NSC directorates with aligned political appointees
and trusted career officials. For instance, the NSA should return a// nonessen-
tial detailees to their home agencies on their first day in office so that the new
Administration can proceed efficiently without the personnel land mines left by
the previous stewards and as soon as possible should replace all essential detailees
with staff aligned to the new President’s priorities. The HSC has overseen pandemic
response, and its incorporation is important.

In the end, change requires intervention, and the NSC staff should be appro-
priately recruited, manned, and empowered to achieve the President’s national
security and foreign policy objectives and maintain robust policy analysis and
discussion while minimizing resistance from those who have an agenda or who
jealously guard their resources and autonomy at the expense of national security
and sound policy development. This resistance and inertia can be inadvertently
enabled by a small and unempowered NSC.

Additionally, the White House Chief of Staff and NSA must ensure that the NSC
is functioning in tandem with the rest of the White House staff to benefit from

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the best strategic thinking of the President’s top advisers. History shows that an

unsupervised NSC staff can stray from its statutory role and adversely affect a Pres-
ident and his policies. Moreover, while the NSC should be fully incorporated into

the White House, it should also be allowed to do its job without the impediment

of dually hatted staff that report to other offices. For instance, the NSC needs its

own counsel to inform what legal options can be provided to the President. The

White House Counsel should be part of that policy process as the President’s top

legal adviser. These recommendations provide a clear road map for rapidly sizing

and solidifying the NSC staff to support and achieve the President’s objectives

beginning on Inauguration Day.

NATIONAL ECONOMIC COUNCIL (NEC)

The National Economic Council is one of the policy councils serving the Pres-
ident along with the NSC and the Domestic Policy Council (DPC). The Director
serves as principal adviser to the President on domestic and international eco-
nomic policy and communicates the President’s economic message to the media.
The Deputy Director is responsible for the day-to-day operation of the council,
which includes chairing the committee that coordinates economic policy devel-
opment at the Deputy Secretary level. In effect, the Director and Deputy Director
are the officials who are primarily responsible for the development of economic
policymaking for the Administration. Once a policy is adopted, it is the appropri-
ate agency’s responsibility to implement it. The NEC’s policy process is also used
to determine whether the President should support or oppose legislation passed
by Congress.

In addition to its leadership, the NEC has policy experts (for example, Special
Assistants to the President or SAPs) who are responsible for developing and coor-
dinating, as well as advising the President, on specific issues. It is essential that
the policy expertise of the NEC reflect the current environment’s most pressing
issues. Today, this would include (among other topics) taxes, energy and envi-
ronment, technology, infrastructure, health care, financial services, workforce,
agriculture, antitrust and competition policy, and retirement programs. NEC’s
SAPs should have a working knowledge of how the Administration can implement
policy through the rulemaking process, although it is not necessary that they be
experts on regulation themselves, particularly given OMB’s role. This will facilitate
the NEC’s effectiveness in coordinating Administration policy.

The NEC needs to work closely with other offices within the Executive Office
of the President to promote innovation by the private sector and create an envi-
ronment that will stimulate economic activity while reducing federal spending
and debt. This includes working with the DPC, NSC, OMB, Council of Economic
Advisers, Office of Intergovernmental Affairs, Office of Cabinet Affairs, White
House Counsel, Council on Environmental Quality, Office of Legislative Affairs,

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Mandate for Leadership: The Conservative Promise

and Office of Science and Technology Policy. To this end, the NEC Director should
chair a standing meeting with the principals from each of the other EOP offices to
enhance coordination from within the White House.

In the past, there has been tension among the DPC, NEC, and NSC over juris-
diction. It is important to set clear jurisdictions at the start of an Administration
to prevent needless and counterproductive turf fights. In addition, the Principal
Deputy for international economic policy is jointly appointed at NEC and NSC and
could end up serving two different interests. To avoid such problems, international
economic policy should be entirely coordinated from NEC.

It will be especially important for the NEC to work seamlessly with the Council
of Economic Advisers (CEA), which provides the President and the White House
offices with the latest economic data and forecasts, as well as estimates of the eco-
nomic impact of proposed policies, and prepares the annual Economic Report of
the President. The CEA is not a policy council and therefore does not run policy
processes, which is the responsibility of the NEC, DPC, and NSC. However, the
CEA does play a key role in ensuring that any policy considered by the councils is
rigorously evaluated for its economic impacts.

The NEC works closely with the White House Office of Communications and
Office of Speechwriting to ensure that the White House’s messaging and media
engagement communicate the President’s economic policy effectively.

The NEC also plays a key role in advancing the President’s economic agenda
by advising the Office of Presidential Personnel on appointments to key economic
posts, including positions in financial regulatory agencies. The NEC helps to ensure
that each economic post is held by a person who shares the President’s policy pri-
orities and works well with the rest of the Administration’s economic team. The
financial regulators are run partly by civil servants (some of whom were politi-
cal appointees in prior liberal Administrations) who often resist a conservative
Administration’s policies. It is therefore critical that an Administration not only
appoints capable individuals to lead these agencies, but also has personnel who
can be hired into senior staff positions within the agencies.

A few areas will be especially important if the NEC is to develop a well-defined
economic policy agenda. One is the promotion of innovation as a foundation for
economic growth and opportunity. Another is the creation of an environment that
fosters economic growth through tax reform and the elimination of regulatory and
procedural barriers.

OFFICE OF THE U.S. TRADE REPRESENTATIVE (USTR)

The Office of the U.S. Trade Representative provides the President with the
internal White House resources necessary to formulate and execute a unified,
whole-of-government approach to trade policy. The President should ensure
that the USTR is empowered to serve in that leadership role, much as other

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2025 Presidential Transition Project

EOP components organize and drive a coordinated policy agenda on behalf of
the President.

The People’s Republic of China’s predatory trade practices have disrupted the
open-market trading system that has provided mutual benefit to all participating
countries—including China—for decades. The failure of the World Trade Organi-
zation (WTO) to discipline China for abrogation of its trading commitments has
seriously undermined its credibility and made it a largely ineffective institution.
The United States, through an empowered USTR, must act to rebalance and refocus
international trading relationships in favor of democratic nations that embrace
free, fair, and open trade principles built on market-driven economies.

Chapter 26 of this book outlines recommended trade policy priorities for the
incoming President. However, regardless of the approach, successful implemen-
tation of that trade agenda will require the President to articulate a clear policy
direction and instructions for the executive branch to operate in a coordinated
fashion under the leadership of an empowered USTR.

To address these and other challenges, protect the American worker, and secure
free and open markets for our communities and businesses, the next President
must leverage the institutional resources and strength of the USTR and neither
allow institutional interests to drive a fragmented trade policy that is developed
from the ground up nor cater to parochial interests across government and Wash-
ington’s broader industry of influence.

The USTR’s mission is vitally important in reorienting the global trading system
in adirection that is open, fair, and prosperous. In order to achieve the President’s
policy goals, a strong USTR must be empowered to set trade policy from the White
House with the authority and resources to represent the interests of the Presi-
dent’s trade agenda with adequate budget, staff, analysis, and expertise to engage
meaningfully in internal and interagency policy deliberations. The USTR should
organize and harness existing interagency trade committees to serve the Presi-
dent’s trade agenda and drive a consensus among federal stakeholders, dispose
of legacy advisory committees with members who serve special interests, direct
action to implement policy priorities, measure progress toward implementing the
President’s agenda, and hold agencies and officials accountable for delivering the
President’s agenda. The USTR’s leadership should not only coordinate and enforce
the President’s agenda across the federal community, but also set and enforce the
President’s trade agenda internally.

Trade policy and priorities should be set by the President and implemented by
the U.S. Trade Representative in cooperation with the other economic and national
security officials, not by the range of governmental and nongovernmental interests
that attempt to force their policy preferences on the USTR. A strong USTR empow-
ered with the necessary resources, authorities, and interagency cooperation will
protect U.S. interests in the global marketplace more effectively.

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Mandate for Leadership: The Conservative Promise

COUNCIL OF ECONOMIC ADVISERS (CEA)

Congress established the Council of Economic Advisers in 1946 to advise the
President on economic policy based on data, research, and evidence. The CEA is
one of the oldest congressionally created offices within the White House complex
and plays a broad role in bringing economic expertise to Administration policy
across a large range of policy areas. The CEA has one presidentially appointed
and Senate-confirmed chair, two presidentially appointed members who assist
and often have expertise that complements the chair, and approximately 40
staff employees.

Statutorily, the CEA is charged with being the President’s principal source of
economic advice. However, this role has diminished over time as its policy appraisal
and especially formulation and recommendation functions have been taken over or
diluted by other economic policy bodies within the White House. By law, the CEA
is required to publish an annual Economic Report of the President within 10 days
after submission of the budget. This report is not just amessaging document; it is
an opportunity to provide greater rigor in support of policy areas that the White
House is prioritizing and to build up the external credibility of those ideas.

A future conservative Administration should utilize the CEA as the senior inter-
nal White House economists much as the White House Counsel’s office functions
as the senior internal White House lawyers. This does not mean that there are no
economists in other offices. There are, just as there often are lawyers in the policy
councils and other White House offices, but the CEA’s role, like the White House
Counsel’s, is to employ its unique expertise (particularly on the technical side) to
ensure that sound analysis is contributing to and shaping the policy discussion.

In practice, this means that CEA staff do not “coordinate” the policy process in
the way that the DPC or NEC would, but they should be integral to the EOP’s policy
development processes. CEA staff should support sound policy development and
execution by actively contributing to running policy dialogues, proactively raising
issues that need to be addressed, consulting on questions that arise, and guiding
EOP and agency officials on the analytical foundations of policy. Structurally, the
White House Chief of Staff should ensure that the CEA has a seat at the policymak-
ing table on all relevant policy.

Senior economists traditionally have not gone through the Office of Presidential
Personnel process and more often than not are hired on an academic-year cycle. As
aresult, senior economists hired in the summer of a presidential election year tend
to remain on staff until the next summer even if a President from the opposite party
takes power and installs anew slate of CEA political appointees for chair, members,
etc. Although these hiring practices create some continuity, the presence of senior
economists who were never fully vetted for their alignment with White House
policy objectives or who were holdovers from a recently departed Administra-
tion can breed skepticism and distrust of the CEA by other units within the White

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2025 Presidential Transition Project

House, creating the risk that the CEA’s role in the policymaking process will be
diminished. A future Administration should consider hiring that reflects the White
House calendar (mid-January) and involves the Office of Presidential Personnel.

NATIONAL SPACE COUNCIL (NSPC)

The National Space Council is responsible for providing advice and recommen-
dations to the President on the formulation and implementation of space policy
and strategy. It is charged with conducting a whole-of-government approach to
the nation’s space interests: civil, military, intelligence, commercial, or diplomatic.
Historically, it has been chaired by the Vice President at the President’s direction,
and its members consist of members of the Cabinet and other senior executive
branch officials as specified by the President in Executive Order 13803.” The
NSpC’s purpose is to ensure that the President’s priorities relative to space are
carried out and, as necessary, to resolve policy conflicts among departments and
agencies that are related to space.

Space projects and programs are risky, complex, expensive, and time consum-
ing—although commercial space innovations are lowering costs and accelerating
schedules. Nevertheless, while fiscal discipline should not be ignored, long-term
policy stability is crucial to investors, innovators, industry, and agencies. Policy
stability is easier when policies and programs are aligned with long-term national
interests as opposed to those of particular advocacy groups or political factions.
The Trump Administration’s major space policies—including the U.S. Space Force,
the Artemis program to land the next Americans on the moon, and support for a
strong commercial space sector—have endured under the Biden Administration.

Major challenges remain in implementation and regulatory reform to keep up
with rapidly evolving space markets and competitors. These include the long-term
sustainability of space activities in light of increasing orbital debris; creation of
space situational awareness services for civil and commercial uses; management
of mega-constellations; licensing of new commercial remote sensing capabilities;
keeping up with licensing demands due to high launch rates; transitioning Inter-
national Space Station operations to multiple, privately owned space platforms;
and (most important) accelerating the acquisition and fielding of national security
space capabilities in response to an increasingly aggressive China.

The Vice President should have a clear understanding with the National Secu-
rity Advisor and the White House Counsel that they and their respective staffs
will work within the White House to determine the scope and leadership of policy
reviews that can overlap multiple areas of responsibility. A similar understanding
is necessary with the heads of other policy councils such as the NEC, DPC, and
National Science and Technology Council (NSTC).

As a result of the President’s direction and the Vice President’s leadership, the
NSpC under the Trump Administration was able to coordinate a wide range of

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Mandate for Leadership: The Conservative Promise

space policy reviews, legislative proposals, and regulatory reforms smoothly. The
NSpC generally led on space issues within the EOP, but other White House offices
also took on space topics.

e Asamember of the NSpC, and in coordination with other members, the
Office of Science and Technology Policy developed a national space weather
strategy, research and development (R&D) plans to mitigate the effects of
orbital debris, and protocols for planetary protection to avoid biological
contamination of celestial bodies.

e The Council of Economic Advisers did research on the economic benefits of
space property rights.

e OMB’s Office of Information and Regulatory Reform updated and
streamlined commercial launch licensing and commercial remote sensing
satellite rules.

During the Trump Administration, if a topic was purely military, such as stand-
ing up the U.S. Space Command, the NSC took the lead. If a topic cut across military,
civil, and commercial sectors, as was the case with cybersecurity in space, the NSpC
and NSC would cochair the policy review groups.

Trusted, collegial relationships across the White House complex are critical to
successful space policy development, implementation, and oversight. Nowhere
is this more important than in the relationship between the NSpC staff and OMB
staff who oversee civil and national security-related space spending. Teamwork
between the NSpC and OMB staff can communicate clear presidential priorities
to departments and agencies, facilitating smooth development of the President’s
budget request. The NSpC and OMB have many opportunities to collaborate in
promoting presidential priorities while finding offsets in lower-priority programs
and funding lines.

OFFICE OF SCIENCE AND TECHNOLOGY POLICY (OSTP)

The White House Office of Science and Technology Policy (OSTP) was created
by the National Science and Technology Policy, Organization, and Priorities Act
of 1976.** Before its creation, Presidents received their advice and counsel on such
matters through advisers and boards that had no statutory authority. The Director
of OSTP is one of the few Senate-confirmed positions within the Executive Office
of the President. Consistent with other laws, the President may delegate to the
Director of OSTP directive authority over other elements of the executive branch.
Other EOP policy officials and organizations such as the NSC and NEC are formally
only advisory with relevant agency directives issued by the President.

2025 Presidential Transition Project

The OSTP’s functions, as contained in the law, are to advise the President of
scientific and technological considerations, evaluate the effectiveness of the federal
effort, and generally lead and coordinate the federal government’s R&D programs.
If science is being manipulated at the agencies to support separate political and
institutional agendas, the President should increase the prominence of the OSTP’s
Director either formally or informally. This would elevate the role of science in
policy discussions and subsequent outcomes and theoretically help to balance
out agencies like the Departments of Energy, State, and Commerce and the Envi-
ronmental Protection Agency and Council on Environmental Quality. The OSTP
can also help to bring technical expertise to regulatory matters in support of OMB.

The OSTP should continue to play a lead role in coordinating federal R&D pro-
grams. Recent legislation, especially the CHIPS and Science Act,** has expanded
federal policy and funding across the enterprise, and there is a need for more sig-
nificant leadership in this area both to ensure effectiveness and to avoid duplication
of effort. As befitting its location in the White House, the OSTP must be concerned
with advancing national interests and not merely the parochial concerns of depart-
ments, agencies, or parts of the scientific community.

During the Trump and Biden Administrations, there has been a bipartisan focus
on prioritizing R&D funding around the so-called Industries of the Future GOTF).
Under President Trump, IOTF priorities were artificial intelligence (AD, quantum
information science (QIS), advanced communications/5G, advanced manufacturing,
and biotechnology. Under President Biden, this list has been expanded to include
advanced materials, robotics, battery technology, cybersecurity, green products and
clean technology, plant genetics and agricultural technologies, nanotechnology, and
semiconductor and microelectronics technologies. These priorities should be eval-
uated and narrowed to ensure consistency with the next Administration’s priorities.

Given a long list of priorities, coordinating efforts across agencies and mea-
suring success are extremely challenging. The OSTP and OMB are required to
work together on an annual basis to prioritize the funding requests and whatever
Congress adds on top of them, but there continues to be concern about mission
creep and funds expended on nonscientific R&D.

The President should also issue an executive order to reshape the U.S. Global
Change Research Program (USGCRP) and related climate change research pro-
grams. The USGCRP produces strategic plans and research (for example, the
National Climate Assessment) that reduce the scope of legally proper options in
presidential decision-making and in agency rulemakings and adjudications. Also,
since much environmental policymaking must run the gauntlet of judicial review,
USGCRP actions can frustrate successful litigation defense in ways that the career
bureaucracy should not be permitted to control. The process for producing assess-
ments should include diverse viewpoints. The OSTP and OMB should jointly assess
the independence of the contractors used to conduct much of this outsourced

Mandate for Leadership: The Conservative Promise

government research that serves as the basis for policymaking. The next President
should critically analyze and, if required, refuse to accept any USGCRP assessment
prepared under the Biden Administration.

The President should also restore related EOP research components to their
purely informational and advisory roles. Consistent with the Global Change
Research Act of 1990,*° USGCRP-related EOP components should be confined to
amore limited advisory role. These components should include but not necessarily
be limited to the OSTP; the NSTC’s Committee on Environment; the USGCRP’s
Interagency Groups (for example, the Carbon Cycle Interagency Working Group);
and the Federal Coordinating Council for Science, Engineering, and Technology.
As a general matter, the new Administration should separate the scientific risk
assessment function from the risk management function, which is the exclusive
domain of elected policymakers and the public.

Finally, the next Administration will face a significant challenge in unwinding
policies and procedures that are used to advance radical gender, racial, and equity
initiatives under the banner of science. Similarly, the Biden Administration’s
climate fanaticism will need a whole-of-government unwinding. As with other
federal departments and agencies, the Biden Administration’s leveraging of the
federal government’s resources to further the woke agenda should be reversed and
scrubbed from all policy manuals, guidance documents, and agendas, and scientific
excellence and innovation should be restored as the OSTP’s top priority.

COUNCIL ON ENVIRONMENTAL QUALITY (CEQ)

The Council on Environmental Quality is the EOP component with the prin-
cipal task of administering the National Environmental Policy Act (NEPA)* by
issuing regulations and interpretive documents and by overseeing the processes
of individual permitting agencies’ own NEPA regulations, including categorical
exclusions. The CEQ also coordinates environmental policy across the federal
government, and its influence has waxed and waned across Administrations.

The President should instruct the CEQ to rewrite its regulations implementing
NEPA along the lines of the historic 2020 effort and restoring its key provisions
such as banning the use of cumulative impact analysis. This effort should incor-
porate new learning and more aggressive reform options that were not included
in the 2020 reform package with the overall goal of streamlining the process to
build on the Supreme Court ruling that “CEQ’s interpretation of NEPA is entitled
to substantial deference.’*’ It should frame the new regulations to limit the scope
for judicial review of agency NEPA analysis and judicial remedies, as well as to
vindicate the strong public interest in effective and timely agency action.

The Federal Permitting Improvement Steering Council (FPISC), of which the
CEQ is a part, has been empowered by Congress through significant new funding
and amendments to FAST-41.** The President should build on this foundation to

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2025 Presidential Transition Project

further empower the FPISC by making its Executive Director an EOP appointee
with delegated presidential directive authority over executive branch permitting
agencies. For instance, the implementation of Executive Order 13807’s One Federal
Decision® revealed many ways that the systems established by EO 13807 can be
improved. The new President should seek to issue a new executive order to create
a unified process for major infrastructure projects that includes giving project
proponents more control of any regulatory clocks.

The President should issue an executive order establishing a Senior Advisor to
coordinate the policy development and implementation of relevant energy and
environment policy by officials across the EOP (for example, the policy staff of the
NSC, NEC, DPC, CEQ, and OSTP) and abolishing the existing Office of Domestic Cli-
mate Policy. The Senior Advisor would report directly to the Chief of Staff. The role
would be similar to the role that Brian Deese and John Podesta had in the Obama
White House. This energy/environment coordinator would help to lead the fight
for sound energy and environment policies both domestically and internationally.

The President should eliminate the Interagency Working Group on the Social
Cost of Carbon (SCC), which is cochaired by the OSTP, OMB, and CEA, and by
executive order should end the use of SCC analysis.

Finally, the President should work with Congress to establish a sweeping mod-
ernization of the entire permitting system across all departments and agencies that
is aimed at reducing litigation risk and giving agencies the authority to establish
programmatic, general, and provisional permits.

OFFICE OF NATIONAL DRUG CONTROL POLICY (ONDCP)

Congress created the Office of National Drug Control Policy (ONDCP) through
the Anti-Drug Abuse Act of 1988*° to serve as a coordinative auxiliary for the Pres-
ident on all matters related to drug policy. The next President’s top drug policy
priority must be to address the current fentanyl crisis and reduce the number of
overdoses and fatalities. This crisis resulted in the deaths of more than 100,000
Americans in 2021.

The next Administration must reaffirm a commitment to preventing drug use
before it starts, providing treatment that leads to long-term recovery, and reducing
the availability of illicit drugs in the United States. The drug trafficking environ-
ment is exponentially more dynamic and dangerous today than it was just five
years ago as powerful synthetic opioids (fentanyl and its analogues) are mixed
into other drugs of abuse. Drug trafficking organizations are extremely nimble and
able to adapt quickly to federal government actions and changes in user behavior.
Disrupting the flow of drugs across our borders and into our communities is of
paramount importance, both to save lives and to bolster our public health efforts.
For these reasons, the Director of ONDCP should make it a point to consult with
federal border enforcement officials.

—61—

Mandate for Leadership: The Conservative Promise

The National Drug Control Program agencies represented a total of $41 billion
in fiscal year 2022. Whereas the position for overseeing budget activities is tradi-
tionally held by a career official, it is imperative that a political appointee lead the
ONDCP budget office to ensure coordination between the OMB Program Associate
Director and the ONDCP budgetary appointee.

ONDCP grant-making activities have been controversial over the years, par-
ticularly within conservative Administrations concerned that the White House
lacks the expertise to oversee such programs directly. The ONDCP administers
two grant programs: the Drug-Free Communities Support Program and the High
Intensity Drug Trafficking Areas Program. While it makes sense to transfer these
programs eventually to the Department of Justice and Department of Health and
Human Services, respectively, it is vital that the ONDCP Director ensure in the
immediate term that these grant programs are funding the President’s drug control
priorities and not woke nonprofits with leftist policy agendas. Thus, the President
must insure that the ONDCP is managed by political appointees who are commit-
ted to the Administration’s agenda and not acquiesce to management by political
or career military personnel who oversaw the prior Administration’s ONDCP.

GENDER POLICY COUNCIL (GPC)

The President should immediately revoke Executive Order 14020” and every
policy, including subregulatory guidance documents, produced on behalf of or
related to the establishment or promotion of the Gender Policy Council and its
subsidiary issues. Abolishing the Gender Policy Council would eliminate central
promotion of abortion (“health services”); comprehensive sexuality education
(“education”); and the new woke gender ideology, which has as a principal tenet

“gender affirming care” and “sex-change” surgeries on minors. In addition to elim-
inating the council, developing new structures and positions will have the dual
effect of demonstrating that promoting life and strengthening the family is a pri-
ority while also facilitating more seamless coordination and consistency across
the U.S. government.

Specifically, the President should appoint a position/point of contact with the
rank of Special Assistant to the President or higher to coordinate and lead the Pres-
ident’s domestic priorities on issues related to life and family in cooperation with
the Domestic Policy Council. This position would be responsible for facilitating
meetings, discussions, and agreements among personnel; coordinating Adminis-
tration policy; and ensuring agency support for implementation of policies related
to the promotion of life and family in the United States.

OFFICE OF THE VICE PRESIDENT (OVP)

The Vice President is elected to the second highest office in the nation and plays
a constitutionally vital role as President-in-waiting. The Vice President is also

—62—

2025 Presidential Transition Project

the President of the Senate and is charged with breaking tie votes in that body. In
recent years, the Vice President has been granted office space in the West Wing
and the Eisenhower Executive Office Building.

The OVP is another one of the levers that the President should use to execute his
agenda. This is particularly true because there is significant and unique leverage
that the Vice President’s leadership of the OVP can evoke to shape policy discus-
sions and outcomes. Every other appointed White House official serves at the
pleasure of the President, whereas the Vice President is elected, and the process
for filling vacancies in that Article II constitutional office, which includes confir-
mation of areplacement Vice President by a majority of both Houses of Congress,
is governed by the Twenty-Fifth Amendment.”

The Vice President has his or her own economic advisers, domestic policy and
national security staff, and daily intelligence briefings. The Vice President should
fill his or her office with strong and sound policy minds to effectively assist the
President in fulfilling his agenda.

The Vice President is also a statutory member of the National Security Council."
In theory, in light of the fact that the Vice President is a member of the Smithso-
nian Institution’s Board of Regents,“ there is nothing to prevent Congress from
assigning the Vice President additional statutory duties.

All of the component councils and offices discussed in this chapter include real
policy development and implementation authority, and a robust OVP should be
fully integrated into all policy-formation procedures. Only a Vice President who
is deeply steeped in the interworking of the interagency and policy councils can
offer useful advice and prove helpful in accomplishing the President’s agenda. It
is also obvious, in view of the fact that many former Vice Presidents have gone on
to be elected President in their own right, that the Vice Presidency can act as a
training ground for presidential office.

In the past, the Vice President has been tasked with leading certain initiatives or
issues. For example, Mike Pence was tasked with coordinating the federal response
to COVID-19, and both Pence and Kamala Harris have chaired the National Space
Council. Vice Presidents Richard Cheney and Dan Quayle were also active on the
deregulatory front and in imposing regulatory moratoria. However, OVP offi-
cials should be fully integrated into each and every process from the start of a
new Administration and not have to wait to be invited to join various meetings or
working groups on an ad hoc basis. For example, the budget and regulatory review
processes are linchpins in the execution of policy, and the OVP should have a seat
at the table through every phase of policy development.

Past Vice Presidents have also spent significant time abroad serving as a type of
brand ambassador for the White House and, more broadly, for the United States,
announcing Administration priorities and coordinating with heads of state and
other top officials of foreign governments. The Vice President, as President of the

Mandate for Leadership: The Conservative Promise

Senate, often serves as a presidential emissary to the Senate and thus can be espe-
cially helpful in securing passage of the President’s legislative agenda.

To the extent that he or she desires, a Vice President can have a direct role in
shaping Administration policy. A Vice President who regularly attends meetings
and disperses staff across the interagency and policy councils is a Vice President
whose voice will be heard.

AUTHOR'S NOTE: Special thanks to those who contributed to this chapter: Stephen Billy, Scott Pace, Casey
Mulligan, Edie Heipel, Mike Duffey, Vance Ginn, lain Murray, Laura Cunliffe, Mario Loyola, Anthony Campau, Paige
Agostin, Molly Sikes, Paul Ray, Kenneth A. Klukowski, Michael Anton, Robert Greenway, Valerie Huber, James Rockas,
Paul Winfree, Aaron Hedlund, Brian McCormack, David Legates, Art Kleinschmidt, Paul Larkin, Kayla Tonnessen,
Jeffrey B. Clark, Jonathan Wolfson, and Bob Burkett.

—64—

2025 Presidential Transition Project

ENDNOTES

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Vice Presidents Gerald Ford and Lyndon Johnson assumed (Ford) or initially assumed (Johnson) the office of

—67—

CENTRAL PERSONNEL AGENCIES:
MANAGING THE BUREAUCRACY
Donald Devine,

Dennis Dean Kirk,

and Paul Dans

OVERVIEW

From the very first Mandate for Leadership, the “personnel is policy” theme has been
the fundamental principle guiding the government’s personnel management. As the U.S.
Constitution makes clear, the President’s appointment, direction, and removal author-
ities are the central elements of his executive power.' In implementing that power, the
people and the President deserve the most talented and responsible workforce possible.

Who the President assigns to design and implement his political policy agenda
will determine whether he can carry out the responsibility given to him by the
American people. The President must recognize that whoever holds a government
position sets its policy. To fulfill an electoral mandate, he must therefore give per-
sonnel management his highest priority, including Cabinet-level precedence.

The federal government’s immense bureaucracy spreads into hundreds of agen-
cies and thousands of units and is centered and overseen at the top by key central
personnel agencies and their governing laws and regulations. The major separate
personnel agencies in the national government today are:

e The Office of Personnel Management (OPM);
e The Merit Systems Protection Board (MSPB);
e The Federal Labor Relations Authority (FLRA); and

e The Office of Special Counsel (OSC).

Mandate for Leadership: The Conservative Promise

Title 5 of the U.S. Code charges the OPM with executing, administering, and
enforcing the rules, regulations, and laws governing the civil service.” It grants the
OPM direct responsibility for activities like retirement, pay, health, training, federal
unionization, suitability, and classification functions not specifically granted to other
agencies by statute. The agency’s Director is charged with aiding the President, as
the President may request, in preparing such civil service rules as the President pre-
scribes and otherwise advising the President on actions that may be taken to promote
an efficient civil service and a systematic application of the merit system principles,
including recommending policies relating to the selection, promotion, transfer, per-
formance, pay, conditions of service, tenure, and separation of employees.

The MSPB is the lead adjudicator for hearing and resolving cases and contro-
versies for 2.2 million federal employees.’ It is required to conduct fair and neutral
case adjudications, regulatory reviews, and actions and studies to improve the
workforce. Its court-like adjudications investigate and hear appeals from agency
actions such as furloughs, suspensions, demotions, and terminations and are
appealable to the U.S. Court of Appeals.

The FLRA hears appeals of agency personnel cases involving federal labor griev-
ance procedures to provide judicial review with binding decisions appealable to
appeals courts.‘ It interprets the rights and duties of agencies and employee labor
organizations—on management rights, OPM interpretations, recognition of labor
organizations, and unfair labor practices—under the general principle of bargain-
ing in good faith and compelling need.

The OSC serves as the investigator, mediator, publisher, and prosecutor before
the MSPB with respect to agency and employees regarding prohibited person-
nel practices, Hatch Act? politicization, Uniformed Services Employment and
Reemployment Rights Act® issues, and whistleblower complaints.’

The Equal Employment Opportunity Commission (EEOC) has general respon-
sibility for reviewing charges of employee discrimination against all civil rights
breaches. However, it also administers a government employee section that investi-
gates and adjudicates federal employee complaints concerning equal employment
violations as with the private sector.* This makes the agency an additional de facto
factor in government personnel management.

While not a personnel agency per se, the General Services Administration (GSA)
is charged with general supervision of contracting.® Today, there are many more
contractors in government than there are civil service employees. The GSA must
therefore be a part of any personnel management discussion.

ANALYSIS AND RECOMMENDATIONS

OPM: Managing the Federal Bureaucracy. At the very pinnacle of the
modern progressive program to make government competent stands the ideal
of professionalized, career civil service. Since the turn of the 20th century,

2025 Presidential Transition Project

progressives have sought a system that could effectively select, train, reward,
and guard from partisan influence the neutral scientific experts they believe are
required to staff the national government and run the administrative state. Their
U.S. system was initiated by the Pendleton Act of 1883” and institutionalized by
the 1930s New Deal to set principles and practices that were meant to ensure that
expert merit rather than partisan favors or personal favoritism ruled within the
federal bureaucracy. Yet, as public frustration with the civil service has grown,
generating calls to “drain the swamp,” it has become clear that their project has
had serious unintended consequences.

The civil service was devised to replace the amateurism and presumed corrup-
tion of the old spoils system, wherein government jobs rewarded loyal partisans
who might or might not have professional backgrounds. Although the system
appeared to be sufficient for the nation’s first century, progressive intellectuals
and activists demanded a more professionalized, scientific, and politically neutral
Administration. Progressives designed a merit system to promote expertise and
shield bureaucrats from partisan political pressure, but it soon began to insulate
civil servants from accountability. The modern merit system increasingly made it
almost impossible to fire all but the most incompetent civil servants. Complying
with arcane rules regarding recruiting, rating, hiring, and firing simply replaced
the goal of cultivating competence and expertise.

In the 1970s, Georgia Democratic Governor Jimmy Carter, then a political
unknown, ran for President supporting New Deal programs and their Great Soci-
ety expansion but opposing the way they were being administered. The policies
were not actually reducing poverty, increasing prosperity, or improving the envi-
ronment, he argued, and to make them work required fundamental bureaucratic
reform. He correctly charged that almost all government employees were rated
as “successful,” all received the same pay regardless of performance, and even the
worst were impossible to fire—and he won the presidency.

President Carter fulfilled his campaign promise by hiring Syracuse University
Dean Alan Campbell, who served first as Chairman of the U.S. Civil Service Com-
mission and then as Director of the OPM and helped him devise and pass the Civil
Service Reform Act of 1978 (CSRA)" to reset the basic structure of today’s bureau-
cracy. A new performance appraisal system was devised with a five rather than
three distribution of rating categories and individual goals more related to agency
missions and more related to employee promotion for all. Pay and benefits were
based directly on improved performance appraisals (including sizable bonuses) for
mid-level managers and senior executives. But time ran out on President Carter
before the act could be fully executed, so it was left to President Ronald Reagan
and his new OPM and agency leadership to implement.

Overall, the new law seemed to work for a few years under Reagan, but the Carter-
Reagan reforms were dissipated within a decade. Today, employee evaluation is back

Mandate for Leadership: The Conservative Promise

to pre-reform levels with almost all rated successful or above, frustrating any rela-
tion between pay and performance. An “outstanding” rating should be required for

Senior Executive Service (SES) chiefs to win big bonuses, but a few years ago, when

it was disclosed that the Veterans Administration executives who encouraged false

reporting of waiting lists for hospital admission were rated outstanding, the Senior

Executive Association justified it, telling Congress that only outstanding performers

would be promoted to the SES in the first place and that precise ratings were unnec-
essary.’ The Government Accountability Office (GAO), however, has reported that

pay raises, within-grade pay increases, and locality pay for regular employees and

executives have become automatic rather than based on performance—as a result

of most employees being rated at similar appraisal levels.’

OPM: Merit Hiring in a Merit System. It should not be impossible even
for a large national government to hire good people through merit selection. The
government did so for years, but it has proven difficult in recent times to select
personnel based on their knowledge, skills, and abilities (KSA) as the law dictates.
Yet for the past 34 years, the U.S. civil service has been unable to distinguish con-
sistently between strong and unqualified applicants for employment.

As the Carter presidency was winding down, the U.S. Department of Justice
and top lawyers at the OPM contrived with plaintiffs to end civil service IQ exam-
inations because of concern about their possible impact on minorities. The OPM
had used the Professional and Administrative Career Examination (PACE) gen-
eral intelligence exam to select college graduates for top agency employment, but
Carter Administration officials—probably without the President’s informed con-
currence—abolished the PACE through a legal consent court decree capitulating
to demands by civil rights petitioners who contended that it was discriminatory.
The judicial decree was to last only five years but still controls federal hiring and
is applied to all KSA tests even today.

General ability tests like the PACE have been used successfully to assess the use-
fulness and cost-effectiveness of broad intellectual qualities across many separate
occupations. Courts have ruled that even without evidence of overt, intentional
discrimination, such results might suggest discrimination. This doctrine of dispa-
rate impact could be ended legislatively or at least narrowed through the regulatory
process by a future Administration. In any event, the federal government has been
denied the use of a rigorous entry examination for three decades, relying instead
on self-evaluations that have forced managers to resort to subterfuge such as
preselecting friends or associates that they believe are competent to obtain qual-
ified employees.

In 2015, President Barack Obama’s OPM began to introduce an improved merit
examination called USAHire, which it had been testing quietly since 2012 ina few
agencies for a dozen job descriptions. The tests had multiple-choice questions with
only one correct answer. Some questions even required essay replies: questions

2025 Presidential Transition Project

that would change regularly to depress cheating. President Donald Trump’s OPM
planned to implement such changes but was delayed because of legal concerns
over possible disparate impact.

Courts have agreed to review the consent decree if the Uniform Guidelines
on Employee Selection Procedures setting the technical requirements for sound
exams are reformed. A government that is unable to select employees based on
KSA-like test qualifications cannot work, and the OPM must move forward on this
very basic personnel management obligation.

The Centrality of Performance Appraisal. In the meantime, the OPM must
manage the workforce it has. Before they can reward or discipline federal employees,
managers must first identify who their top performers are and who is performing
less than adequately. In fact, as Ludwig von Mises proved in his classic Bureaucracy,"
unlike the profit-and-loss evaluation tool used in the private sector, government
performance measurement depends totally on a functioning appraisal system. If
they cannot be identified in the first place within a functioning appraisal system, it is
impossible to reward good performance or correct poor performance. The problem
is that the collegial atmosphere of a bureaucracy in a multifaceted appraisal system
that is open to appeals makes this a very challenging ideal to implement successfully.

The GAO reported more recently that overly high and widely spread perfor-
mance ratings were again plaguing the government, with more than 99 percent of
employees rated fully successful or above by their managers, a mere 0.3 percent
rated as minimally successful, and 0.1 percent actually rated unacceptable.’* Why?
It is human nature that no one appreciates being told that he or she is less than
outstanding in every way. Informing subordinates in a closely knit bureaucracy
that they are not performing well is difficult. Rating compatriots is even consid-
ered rude and unprofessional. Moreover, managers can be and often are accused
of racial or sexual discrimination for a poor rating, and this discourages honesty.

In 2018, President Trump issued Executive Order 13839" requiring agen-
cies to reduce the time for employees to improve performance before corrective
action could be taken; to initiate disciplinary actions against poorly performing
employees more expeditiously; to reiterate that agencies are obligated to make
employees improve; to reduce the time for employees to respond to allegations
of poor performance; to mandate that agencies remind supervisors of expiring
employee probationary periods; to prohibit agencies from entering into settlement
agreements that modify an employee’s personnel record; and to reevaluate proce-
dures for agencies to discipline supervisors who retaliate against whistleblowers.
Unfortunately, the order was overturned by the Biden Administration,” so it will
need to be reintroduced in 2025.

The fact remains that meaningfully evaluating employees’ performance is a
critical part of a manager’s job. In the Reagan appraisal process, managers were
evaluated on how they themselves rated their subordinates. This is critical to

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Mandate for Leadership: The Conservative Promise

responsibility and improved management. It is essential that political executives

build policy goals directly into employee appraisals both for mission success and

for employees to know what is expected. Indistinguishable from their coworkers

on paper, hard-working federal employees often go unrewarded for their efforts

and are often the system’s greatest critics. Federal workers who are performing

inadequately get neither the benefit of an honest appraisal nor clear guidance on

how to improve. Political executives should take an active role in supervising per-
formance appraisals of career staff, not unduly delegate this responsibility to senior

career managers, and be willing to reward and support good performers.

Merit Pay. Performance appraisal means little to daily operations if it is not tied
directly to real consequences for success as well as failure. According to asurvey of
major U.S. private companies—which, unlike the federal government, also have a
profit-and-loss evaluation—90 percent use a system of merit pay for performance
based on some type of appraisal system. Despite early efforts to institute merit pay
throughout the federal government, however, compensation is still based primarily
on seniority rather than merit.

Merit pay for executives and managers was part of the Carter reforms and was
implemented early in the Reagan presidency. Beginning in the summer of 1982,
the Reagan OPM entered 18 months of negotiations with House and Senate staff
on extending merit pay to the entire workforce. Long and detailed talks between
the OPM and both Democrats and Republicans in Congress ensued, and a final
agreement was reached in 1983 that supposedly ensured the passage of legislation
creating anew Performance Management and Recognition System (PMRS) for all,
(not just management) GS-13 through GS-15 employees.

Meanwhile, the OPM issued regulations to expand the role of performance
related to pay throughout the entire workforce, but congressional allies of the
employee unions, led by Representative Steny Hoyer (D) of government employee-
rich Maryland, stoutly resisted this extension of pay-for-performance and, with
strong union support, used the congressional appropriations process to block OPM
administrative pay reforms. Bonuses for SES career employees survived, but per-
formance appraisals became so high and widely distributed that there was little
relationship between performance and remuneration.

Ever since the original merit pay system for federal managers (GM-13 through
GM-15 grade levels, just below the SES) was allowed to expire in September 1993,
little to nothing has been done either to reinstate the federal merit pay program for
managers or to distribute performance rating evaluations for the SES, much less to
extend the program to the remainder of the workforce. A reform-friendly President
and Congress might just provide the opportunity to create a more comprehensive
performance plan; in the meantime, however, political executives should use exist-
ing pay and especially fiscal awards strategically to reward good performance to
the degree allowed by law.

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2025 Presidential Transition Project

Making the Appeals Process Work. The nonmilitary government dismissal
rate is well below 1 percent, and no private-sector industry employee enjoys the
job security that a federal employee enjoys. Both safety and justice demand that
managers learn to act strategically to hire good and fire poor performers legally.
The initial paperwork required to separate poor or abusive performers (when they
are infrequently identified) is not overwhelming, and managers might be motivated
to act ifit were not for the appeals and enforcement processes. Formal appeal in the
private sector is mostly a rather simple two-step process, but government unions
and associations have been able to convince politicians to support a multiple and
extensive appeals and enforcement process.

As noted, there are multiple administrative appeals bodies. The FLRA, OSC,
and EEOC have relatively narrow jurisdictions. Claims that an employee’s removal
or disciplinary actions violate the terms of a collective bargaining agreement
between an agency and a union are handled by the FLRA, employees who claim
their removal was the result of discrimination can appeal to the EEOC, and employ-
ees who believe their firing was retribution for being a whistleblower can go to the
OSC. While the MSPB specializes in abuses of direct merit system issues, it can
and does hear and review almost any of the matters heard by the other agencies.

Cases involving race, gender, religion, age, pregnancy, disability, or national
origin can be appealed to the EEOC or the MSPB—and in some cases to both—and
to the OSC. This gives employees multiple opportunities to prove their cases, and
while the EEOC, MSPB, FLRA, and OSC may all apply essentially the same burden
of proof, the odds of success may be substantially different in each forum. In fact,
forum shopping among them for a friendlier venue is acommon practice, but fre-
quent filers face no consequences for frivolous complaints. As aresult, meritorious
cases are frequently delayed, denying relief and justice to truly aggrieved individuals.

The MSPB can and does handle all such matters, but it faces a backlog of an
estimated 3,000 cases of people who were potentially wrongfully terminated or
disciplined as far back as 2013. From 2017-2022 the MSPB lacked the quorum
required to decide appeals. On the other hand, as of January 2023, the EEOC had
a backlog of 42,000 cases.

While federal employees win appeals relatively infrequently—MSPB adminis-
trative judges have upheld agency decisions as much as 80 percent of the time—the
real problem is the time and paperwork involved in the elaborate process that
managers must undergo during appeals. This keeps even the best managers from
bringing cases in all but the most egregious cases of poor performance or mis-
conduct. As a result, the MSPB, EEOC, FLRA, and OSC likely see very few cases
compared to the number of occurrences, and nonperformers continue to be paid
and often are placed in nonwork positions.

Having a choice of appeals is especially unique to the government. If lower-pri-
ority issues were addressed in-house, serious adverse actions would be less subject

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Mandate for Leadership: The Conservative Promise

to delay. With the proper limitation of labor union actions, the FLRA should
have limited reason for appeals. The EEOC’s federal employee section should be
transferred to the MSPB, and many of the OCS’s investigatory functions should be
returned to the OPM. The MSPB could then become the main reviewer of adverse
actions, greatly simplifying the burdensome appeal process.

Making Civil Service Benefits Economically and Administratively Ratio-
nal. In recent years, the combined wages and benefits of the executive branch
civilian workforce totaled $300 billion according to official data. But even that
amount does not properly account for billions in unfunded liability for retirement
and other government reporting distortions. Official data also report employment
as approximately 2 million, but this ignores approximately 20 million contractors
who, while not eligible for government pay and benefits, do receive them indirectly
through contracting (even if they are less generous). Official data also claim that
national government employees are paid less than private-sector employees are
paid for similar work, but several more neutral sources demonstrate that pub-
lic-sector workers make more on average than their private-sector counterparts.
All of this extravagance deserves close scrutiny.

Market-Based Pay and Benefits. According to current law, federal workers
are to be paid wages comparable to equivalent private-sector workers rather than
compared to all private-sector employees. While the official studies claim that
federal employees are underpaid relative to the private sector by 20 percent or
more, a 2016 Heritage Foundation study found that federal employees received
wages that were 22 percent higher than wages for similar private-sector workers;
if the value of employee benefits was included, the total compensation premium
for federal employees over their private-sector equivalents increased to between
30 percent and 40 percent.'* The American Enterprise Institute found a 14 percent
pay premium and a 61 percent total compensation premium.”

Base salary is only one component of a federal employee’s total compensation.
In addition to high starting wages, federal employees normally receive an annual
cost-of-living adjustment (available to all employees) and generous scheduled
raises known as step increases. Moreover, a large proportion of federal employ-
ees are stationed in the Washington, D.C., area and other large cities and are
entitled to steep locality pay enhancement to account for the high cost of living
in these areas.

A federal employee with five years’ experience receives 20 vacation days, 13 paid
sick days, and all 10 federal holidays compared to an employee at a large private
company who receives 13 days of vacation and eight paid sick days. Federal health
benefits are more comparable to those provided by Fortune 500 employers with
the government paying 72 percent of the weighted average premiums, but this is
much higher than for most private plans. Almost half of private firms do not offer
any employer contributions at all.

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2025 Presidential Transition Project

The obvious solution to these discrepancies is to move closer to a market model
for federal pay and benefits. One need is for a neutral agency to oversee pay hiring
decisions, especially for high-demand occupations. The OPM is independent of
agency operations, so it can assess requirements more neutrally. For many years,
with its Special Pay Rates program, the OPM evaluated claims that federal rates
in an area were too low to attract competent employees and allowed agencies to
offer higher pay when needed rather than increased rates for all. Ideally, the OPM
should establish an initial pay schedule for every occupation and region, monitor
turnover rates and applicant-to-position ratios, and adjust pay and recruitment
on that basis. Most of this requires legislation, but the OPM should be an advocate
for a true equality of benefits between the public and private sectors.

Reforming Federal Retirement Benefits. Career civil servants enjoy retire-
ment benefits that are nearly unheard of in the private sector. Federal employees
retire earlier (normally at age 55 after 30 years), enjoy richer pension annuities,
and receive automatic cost-of-living adjustments based on the areas in which they
retire. Defined-benefit federal pensions are fully indexed for inflation—a practice
that is extremely rare in the private sector. A federal employee with a preretire-
ment income of $25,000 under the older of the two federal retirement plans will
receive at least $200,000 more over a 20-year period than will private-sector work-
ers with the same preretirement salary under historic inflation levels.

During the early Reagan years, the OPM reformed many specific provisions of
the federal pension program to save billions administratively. Under OPM pres-
sure, Reagan and Congress ultimately ended the old Civil Service Retirement
System (CSRS) entirely for new employees, which (counting disbursements for
the unfunded liability) accounted for 51.3 percent of the federal government's
total payroll. The retirement system that replaced it—the Federal Employees
Retirement System (FERS)—reduced the cost of federal employee retirement dis-
bursements to 28.5 percent of payroll (including contributions to Social Security
and the employer match to the Thrift Savings Plan). More of the pension cost was
shifted to the employee, but the new system was much more equitable for the 40
percent who received few or no benefits under the old system.

By 1999, more than half of the federal workforce was covered by the new system,
and the government’s per capita share of the cost (as the employer) was less than
half the cost of the old system: 20.2 percent of FERS payroll vs. 44.3 percent of
CSRS payroll, representing one of the largest examples of government savings
anywhere. Although the government pension system has become more like private
pension systems, it still remains much more generous, and other means might be
considered in the future to move it even closer to private plans.

GSA: Landlord and Contractor Management. The General Services
Administration is best known as the federal government’s landlord—designing,
constructing, managing, and preserving government buildings and leasing and

Mandate for Leadership: The Conservative Promise

managing outside commercial real estate contracting with 376.9 million square feet
of space. Obviously, as its prime function, real estate expertise is key to the GSA’s
success. However, the GSA is also the government’s purchasing agent, connecting
federal purchasers with commercial products and services in the private sector
and their personnel management functions. With contractors performing so many
functions today, the GSA therefore becomes a de facto part of governmentwide
personnel management. The GSA also manages the Presidential Transition Act
(PTA) process, which also directly involves the OPM. A recent proposal would
have incorporated the OPM and GSA (and OMB). Fortunately, this did not take
place in that form, but it would make sense for GSA and OPM leadership and staff
to hold regular meetings to work through matters of common interest such as
moderating PTA personnel restrictions and the relationships between contract
and civil service employees.

Reductions-in-Force. Reducing the number of federal employees seems an
obvious way to reduce the overall expense of the civil service, and many prior
Administrations have attempted to do just this. Presidents Bill Clinton and
Barack Obama began their terms, as did Ronald Reagan and Donald Trump, by
mandating a freeze on the hiring of new federal employees, but these efforts did
not lead to permanent and substantive reductions in the number of nondefense
federal employees.

First, it is a challenge even to know which workers to cut. As mentioned, there
are 2 million federal employees, but since budgets have exploded, so has the
total number of personnel with nearly 10 times more federal contractors than
federal employees. Contractors are less expensive because they are not entitled
to high government pensions or benefits and are easier to fire and discipline. In
addition, millions of state government employees work under federal grants, in
effect administering federal programs; these cannot be cut directly. Cutting federal
employment can be helpful and can provide a simple story to average citizens, but
cutting functions, levels, funds, and grants is much more important than setting
simple employment size.

Simply reducing numbers can actually increase costs. OMB instructions fol-
lowing President Trump’s employment freeze told agencies to consider buyout
programs, encouraging early retirements in order to shift costs from current bud-
gets in agencies to the retirement system and minimize the number of personnel
fired. The Environmental Protection Agency immediately implemented such a
program, and OMB urged the passage of legislation to increase payout maximums
from $25,000 to $40,000 to further increase spending under the “cuts.” President
Clinton’s OMB had introduced a similar buyout that cost the Treasury $2.8 billion,
mostly for those who were going to retire anyway. Moreover, when a new employee
is hired to fill ajob recently vacated in a buyout, the government for a time is paying
two people to fill one job.

2025 Presidential Transition Project

What is needed at the beginning is a freeze on all top career-position hiring
to prevent “burrowing-in” by outgoing political appointees. Moreover, four fac-
tors determine the order in which employees are protected during layoffs: tenure,
veterans’ preference, seniority, and performance in that order of importance.
Despite several attempts in the House of Representatives during the Trump years
to enact legislation that would modestly increase the weight given to performance
over time-of-service, the fierce opposition by federal managers associations and
unions representing long-serving but not necessarily well-performing constituents
explains why the bills failed to advance. A determined President should insist that
performance be first and be wary of costly types of reductions-in-force.

Impenetrable Bureaucracy. The GAO has identified almost a hundred actions
that the executive branch or Congress could take to improve efficiency and effec-
tiveness across 37 areas that span a broad range of government missions and
functions. It identified 33 actions to address mission fragmentation, overlap, and
duplication in the 12 areas of defense, economic development, health, homeland
security, and information technology. It also identified 59 other opportunities for
executive agencies or Congress to reduce the cost of government operations or
enhance revenue collection across 25 areas of government.”

A logical place to begin would be to identify and eliminate functions and pro-
grams that are duplicated across Cabinet departments or spread across multiple
agencies. Congress hoped to help this effort by passing the Government Perfor-
mance and Results Act of 1993," which required all federal agencies to define
their missions, establish goals and objectives, and measure and report their per-
formance to Congress. Three decades of endless time-consuming reports later,
the government continues to grow but with more paper and little change either
in performance or in the number of levels between government and the people.

The Brookings Institution’s Paul Light emphasizes the importance of the
increasing number of levels between the top heads of departments and the people
at the bottom who receive the products of government decision-making. He esti-
mates that there are perhaps 50 or more levels of impenetrable bureaucracy and no
way other than imperfect performance appraisals to communicate between them.”

The Trump Administration proposed some possible consolidations, but these
were not received favorably in Congress, whose approval is necessary for most such
proposals. The best solution is to cut functions and budgets and devolve respon-
sibilities. That is a challenge primarily for Presidents, Congress, and the entire
government, but the OPM still needs to lead the way governmentwide in managing
personnel properly even in any future smaller government.

Creating a Responsible Career Management Service. The people elect a
President who is charged by Article 2, Section 3 of the Constitution” with seeing
that the laws are “faithfully executed” with his political appointees democratically
linked to that legitimizing responsibility. An autonomous bureaucracy has neither

Mandate for Leadership: The Conservative Promise

independent constitutional status nor separate moral legitimacy. Therefore, career
civil servants by themselves should not lead major policy changes and reforms.

The creation of the Senior Executive Service was the top career change intro-
duced by the 1978 Carter-Campbell Civil Service Reform Act. Its aim was to
professionalize the career service and make it more responsible to the democrat-
ically elected commander in chief and his political appointees while respecting the
rights due to career employees, very much including those in the top positions. The
new SES would allow management to be more flexible in filling and reassigning
executive positions and locations beyond narrow specialties for more efficient
mission accomplishment and would provide pay and large bonuses to motivate
career performance.

The desire to infiltrate political appointees improperly into the high career
civil service has been widespread in every Administration, whether Democrat or
Republican. Democratic Administrations, however, are typically more successful
because they require the cooperation of careerists, who generally lean heavily to
the Left. Such burrowing-in requires career job descriptions for new positions that
closely mirror the functions of a political appointee; a special hiring authority that
allows the bypassing of veterans’ preference as well as other preference categories;
and the ability to frustrate career candidates from taking the desired position.

President Reagan’s OPM began by limiting such SES burrowing-in, arguing
that the proper course was to create and fill political positions. This simultane-
ously promotes the CSRA principle of political leadership of the bureaucracy and
respects the professional autonomy of the career service. But this requires that
career SES employees should respect political rights too. Actions such as career
staff reserving excessive numbers of key policy positions as “career reserved” to
deny them to noncareer SES employees frustrate CSRA intent. Another evasion
is the general domination by career staff on SES personnel evaluation boards, the
opposite of noncareer executives dominating these critical meeting discussions
as expected in the SES. Career training also often underplays the political role in
leadership and inculcates career-first policy and value viewpoints.

Frustrated with these activities by top career executives, the Trump Adminis-
tration issued Executive Order 13957” to make career professionals in positions
that are not normally subject to change as a result of a presidential transition but
who discharge significant duties and exercise significant discretion in formulating
and implementing executive branch policy and programs an exception to the com-
petitive hiring rules and examinations for career positions under a new Schedule
F. It ordered the Director of OPM and agency heads to set procedures to prepare
lists of such confidential, policy-determining, policymaking, or policy-advocating
positions and prepare procedures to create exceptions from civil service rules when
careerists hold such positions, from which they can relocate back to the regular
civil service after such service. The order was subsequently reversed by President

2025 Presidential Transition Project

Biden” at the demand of the civil service associations and unions. It should be
reinstated, but SES responsibility should come first.

Managing Personnel in a Union Environment. Historically, unions were
thought to be incompatible with government management. There is a natural limit
to the bargaining power of private-sector unions, but the financial bottom line of
public-sector unions is not similarly constrained. If private-sector unions push
too hard a bargain, they can so harm a company or so reduce efficiency that their
employer is forced to go out of business and eliminate union jobs altogether. There
is no such limit in government, which cannot go out of business, so demands can
be excessive without negatively affecting employee and union bottom lines.

Even Democratic President Franklin Roosevelt considered union representa-
tion in the federal government to be incompatible with democracy. Striking and
even threats of bargaining and delay were considered acts against the people and
thus improper. It was not until President John Kennedy that union representation
in the federal government was recognized—and then merely by executive order.
Labor bargaining was not set in statute until the Carter Administration was forced
by Congress to do so in order to pass the CSRA, although all bargaining was placed
under OPM review.

The CSRA was able to maintain strong management rights for the OPM and
agencies and forbade collective bargaining on pay and benefits as well as manage-
ment prerogatives. Over time, OPM, FLRA, and agencies’ personnel offices and
courts, especially in Democratic Administrations, narrowed management rights
so that labor bargaining expanded as management rights contracted. But the man-
agement rights are still in statute, have been enforced by some Administrations,
and should be enforced again by any future OPM and agency managements, which
should not be intimidated by union power.

Rather than being daunted, President Trump issued three executive orders:

e Executive Order 13836, encouraging agencies to renegotiate all union
collective bargaining agreements to ensure consistency with the law and
respect for management rights;?°

e Executive Order 13837, encouraging agencies to prevent union
representatives from using official time preparing or pursuing grievances or
from engaging in other union activity on government time;”’ and

e Executive Order 13839, encouraging agencies both to limit labor grievances
on removals from service or on challenging performance appraisals and to
prioritize performance over seniority when deciding who should be retained
following reductions-in-force.”®

Mandate for Leadership: The Conservative Promise

All were revoked by the Biden Administration” and should be reinstated by the
next Administration, to include the immediate appointment of the FLRA General
Counsel and reactivation of the Impasses Panel.

Congress should also consider whether public-sector unions are appropriate
in the first place. The bipartisan consensus up until the middle of the 20th cen-
tury held that these unions were not compatible with constitutional government.”
After more than halfa century of experience with public-sector union frustrations
of good government management, it is hard to avoid reaching the same conclusion.

Fully Staffing the Ranks of Political Appointees. The President must rely
legally on his top department and agency officials to run the government and on top
White House staff employees to coordinate operations through regular Cabinet and
other meetings and communications. Without this political leadership, the career
civil service becomes empowered to lead the executive branch without democratic
legitimacy. While many obstacles stand in his way, a President is constitutionally
and statutorily required to fill the top political positions in the executive branch
both to assist him and to provide overall legitimacy.

Most Presidents have had some difficulty obtaining congressional approval of
their appointees, but this has worsened recently. After the 2016 election, President
Trump faced special hostility from the opposition party and the media in getting
his appointees confirmed or even considered by the Senate. His early Office of
Presidential Personnel (PPO) did not generally remove political appointees from
the previous Administration but instead relied mostly on prior political appoin-
tees and career civil servants to run the government. Such a reliance on holdovers
and bureaucrats led to a lack of agency control and the absolute refusal of the
Acting Attorney General from the Obama Administration to obey a direct order
from the President.

Under the early PPO, the Trump Administration appointed fewer political
appointees in its first few months in office than had been appointed in any recent
presidency, partly because of historically high partisan congressional obstructions
but also because several officials announced that they preferred fewer political
appointees in the agencies as a way to cut federal spending. Whatever the reasoning,
this had the effect of permanently hampering the rollout of the new President’s
agenda. Thus, in those critical early years, much of the government relied on senior
careerists and holdover Obama appointees to carry out the sensitive responsibili-
ties that would otherwise belong to the new President’s appointees.

Fortunately, the later PPO, OPM, and Senate leadership began to cooperate to
build a strong team to implement the President’s personnel appointment agenda.
Any new Administration would be wise to learn that it will need a full cadre of
sound political appointees from the beginning if it expects to direct this enormous
federal bureaucracy. A close relationship between the PPO at the White House
and the OPM, coordinating with agency assistant secretaries of administration

2025 Presidential Transition Project

and PPO’s chosen White House Liaisons and their staff at each agency, is essential
to the management of this large, multilevel, resistant, and bureaucratic challenge.
If “personnel is policy” is to be our general guide, it would make sense to give the
President direct supervision of the bureaucracy with the OPM Director available
in his Cabinet.

A REFORMED BUREAUCRACY

Today, the federal government’s bureaucracy cannot even meet its own civil
service ideals. The merit criteria of ability, knowledge, and skills are no longer the
basis for recruitment, selection, or advancement, while pay and benefits for com-
parable work are substantially above those in the private sector. Retention is not
based primarily on performance, and for the most part, inadequate performance
is not appraised, corrected, or punished.

The authors have made many suggestions here that, if implemented, could
bring that bureaucracy more under control and enable it to work more efficiently
and responsibly, which is especially required for the half of civilian government
that administers its undeniable responsibilities for defense and foreign affairs.
While a better administered central bureaucracy is crucial for both those and
domestic responsibilities, the problem of properly running the government goes
beyond simple bureaucratic administration. The specific deficiencies of the fed-
eral bureaucracy—size, levels of organization, inefficiency, expense, and lack of
responsiveness to political leadership—are rooted in the progressive ideology that
unelected experts can and should be trusted to promote the general welfare in just
about every area of social life.

The Constitution, however, reserved a few enumerated powers to the federal
government while leaving the great majority of domestic activities to state, local,
and private governance. As James Madison explained: “The powers reserved to
the several States will extend to all the objects, which, in the ordinary course of
affairs, concern the lives, liberties and properties of the people; and the internal
order, improvement and prosperity of the state.”*? Modern progressive politics
has simply given the national government more to do than the complex separa-
tion-of-powers Constitution allows.

That progressive system has broken down in our time, and the only real solution
is for the national government to do less: to decentralize and privatize as much as
possible and then ensure that the remaining bureaucracy is managed effectively
along the lines of the enduring principles set out in detail here.

AUTHORS? NOTE: The authors are grateful for the collaborative work of the individuals listed as contributors to
this chapter for the 2025 Presidential Transition Project. The authors alone assume responsibility for the content of
this chapter, and no views expressed herein should be attributed to any other individual.

Mandate for Leadership: The Conservative Promise

U.S. Constitution, Article II, Section 2, httos://www.law.cornell.edu/constitution/articleii#section! (accessed

5 US. Code §§ 1101 et seq. and 1103(a)(5), https://www.law.cornell.edu/uscode/text/5/part-Il/chapter-11

5 U.S. Code § 1201, https://www.law.cornell.edu/uscode/text/5/1201 (accessed February 1, 2023).
5 US. Code § 7101, https://www.law.cornell.edu/uscode/text/5/7101 (accessed February 1, 2023), and § 7117,

S. 1871, An Act to Prevent Pernicious Political Activities, Public Law No. 76-252, August 2, 1939, https://
govtrackus.s3.amazonaws.com/legislink/pdf/stat/53/STATUTE-53-Pg1147.pdf (accessed February 1, 2023).
H.R. 995, Uniformed Services Employment and Reemployment Rights Act of 1994, Public Law No. 103-353,

st Congress, October 13, 1994, https://www.congress.gov/103/statute/STATUTE-108/STATUTE-108-Pg3149.

5 US. Code § 1206, https://www.law.cornell.edu/uscode/text/5/1206 (accessed February 1, 2023).
42 U.S. Code § 2000e, https://www.law.cornell.edu/uscode/text/42/2000e (accessed February 1, 2023).
40 US. Code § 581, https://www.law.cornell.edu/uscode/text/40/581 (accessed February 1, 2023).
U.S. National Archives, “Milestone Documents: Pendleton Act (1883),” last review

leton-act (accessed February 2, 2

S. 2640, Civil Service Reform Act of 1978, Public Law No. 95-454, 95th Congress,

dwig von Mises, Bureaucracy (New Haven, CT: Yale University Press, 1944), htt
rg/17/items/mises-pdfs/1944-01-01_LudwigVonMises_Bureaucracy.pdf (access

| Workforce: Distribution of Perfo

countability Office, Resu/ts-Orien

89, January 2015, https://www.gao.gov/assets/gao-15-189.pdf (accessed March 1
Accountability Office, “Measuring Federal Employee Performance,’ WatchBlog, posted October 18, 2016,

ng-federal-employee-performan

Lisa Rein, “The Federal Workforce, Where Everyone's Performance Gets Rave Re
June 13, 2016, https://www.washingtonpost.com/news/powerpost/wp/2016/06/

-average-way-above/ (accessed

vice Employee Performance Rati

ed February 8, 2022, https://
023).
October 13, 1978, https://

l.pdf (accessed February 2, 2023).
Donovan Sack and Bill Theobald, “Veterans Affairs Pays $140 Million in Bonuses Amid Scandals,” USA Today,
ics/2015/11/11/veterans-affairs-pays-142-

rmance Ratings Across

ay 9, 2016, https://www.gao.gov/assets/gao-16-520r.pdf

ted Management: OPM Needs

to Do More to Ensure Meaningful Distinctions Are Made in SES Ratings and Performance Awards, GAO-15-

5, 2023); U.S. Government

ce (accessed March 15, 2023):

views,” The Washington Post,

3/heres-the-news-from-the-
arch 15, 2023).

ps://ia902300.us.archive.

ed February 2, 2023).

ng Outcomes (All Rating

ent Accountability Office, “Federal Workforce: Distribution of

39, “Promoting Accountability an
ples,” May 25, 2018, in Federal Re

ENDNOTES
1.
February 1, 2023).
2.
(accessed February 1, 2023).
3.
4,
https://Awww.law.cornell.edu/uscode/text/5/7117 (accessed February 1, 2023).
5.
6.
101
pdf (accessed February 1, 2023).
7.
8.
9.
10.
www.archives.gov/milestone-documents/pend
11.
www.congress.gov/95/statute/STATUTE-92/STATUTE-92-Pg]
12.
ovember 11, 2015, https://www.usatoday.com/story/news/po
million-bonuses-amid-scandals/75537586/ (accessed March 15, 2023).
13. U.S. Government Accountability Office, “Federa
he Federal Government, 2013,” GAO-16-520R,
(accessed March 15, 2023); U.S. Government Ac
httos://www.gao.gov/blog/2016/10/18/measuri
ederal-government-where-everyone-is-above
14, 4
0
15. Figure 1, “Permanent, Non-Senior Executive Se
Systems, Calendar Year 2013),” in U.S. Governm
Performance Ratings Across the Federal Government, 2013,” p. 6.
16. President Donald J. Trump, Executive Order 158
Procedures Consistent with Merit System Princi
February 2, 2023).
17. President Joseph R. Biden Jr., Executive Order
Federal Register, Vol. 86, No. 16 January 27, 20
2021-01-27/pdf/2021-01924.pdf (accessed February 2, 2023).
18.
compensation-federal-employees.
19.

— $4 —

d Streamlining Removal
gister, Vol. 83, No. 106 June 1,

2018), pp. 25343-25347, https://www.govinfo.gov/content/pkg/FR-2018-06-01/pdf/2018-11939.pdf (accessed

4003, “Protecting the Federal Workforce,” January 22, 2021, in
21), pp. 7231-7233, https://www.govinfo.gov/content/pkg/FR-

Rachel Greszler and James Sherk, “Why It Is Time to Reform Compensation for Federal Employees,” The
Heritage Foundation, July 27, 2016, httos://www.heritage.org/jobs-and-labor/report/why-it-time-reform-

Andrew G. Biggs and Jason Richwine, “Comparing Federal and Private Sector Compensation,” American
Enterprise Institute Working Paper No. 2011-02, revised June 2011, https://www.aei.org/wp-content/
uploads/2011/10/AEl-Working-Paper-on-Federal-Pay-May-2011.pdf?x91208 (accessed February 2, 2023).

20.

21.

22.

23.

24.

25:
26.

27.

28.
29.
30.

31.

2025 Presidential Transition Project

See Gene L. Dodaro, Comptroller General of the United States, “Government Efficiency and Effectiveness:
Opportunities to Reduce Fragmentation, Overlap, and Duplication and Achieve Billions in Financial Benefits,”
testimony before the Subcommittee on Emerging Threats and Spending Oversight, Committee on Homeland
Security and Governmental Affairs, U.S. Senate, GAO-21-544T, May 12, 2021, https://www.gao.gov/assets/gao-
21-544t.pdf (accessed February 2, 2023).
S. 20, Government Performance and Results Act of 1993, Public Law No. 103-62, 103rd Congress, August
3, 1993, httos://www.congress.gov/103/statute/STATUTE-107/STATUTE-107-Pg285.pdf (accessed
February 2, 2023).
Paul Light, “The Real Crisis in Government,” The Capital Times (Madison, Wisconsin), January 22, 2010, https://
captimes.com/news/opinion/column/paul-c-light-the-real-crisis-in-government/article_9e139318-3d00-
5898-908d-4c7aeelel05d.html (accessed March 15, 2023).

U.S. Constitution, Article Il, Section 3, https://www.law.cornell.edu/constitution/articleii#tsection3 (accessed
February 2, 2023).

President Donald J. Trump, Executive Order 13957, “Creating Schedule F in the Excepted Service,” October 21,
2020, in Federal Register, Vol. 85, No. 207 (October 26, 2020), pp. 67631-67635, https://www.govinfo.gov/
content/pkg/FR-2020-10-26/pdf/2020-23780.pdf (accessed February 2, 2023).
See note 17, supra.

President Donald J. Trump, Executive Order 13836, “Developing Efficient, Effective, and Cost-Reducing
Approaches to Federal Sector Collective Bargaining,’ May 25, 2018, in Federal Register, Vol. 83, No. 106 June 1,
2018), pp. 25329-25334, https://www.govinfo.gov/content/pkg/FR-2018-06-01/pdf/2018-11913.pdf (accessed
February 2, 2023).
President Donald J. Trump, Executive Order 15837, “Ensuring Transparency, Accountability, and Efficiency

in Taxpayer-Funded Union Time Use,” May 25, 2018, in Federa/ Register, Vol. 83, No. 106 (June 1, 2018),

pp. 25335-25340, https://www.govinfo.gov/content/pkg/FR-2018-06-01/pdf/2018-11916.pdf (accessed
February 2, 2023).

See note 16, supra.

See note 17, supra.

Philip K. Howard, Not Accountable: Rethinking the Constitutionality of Public Employee Unions (Garden City,
NY: Rodin Books, 2023).

James Madison, The Federalist Papers No. 45, January 26, 1788, https://founders.archives.gov/documents/
Madison/01-10-02-0254 (accessed February 1, 2023).

—8g5—

Section Two

THE COMMON DEFENSE

hile the lives of Americans are affected in noteworthy ways, for better or
worse, by each part of the executive branch, the inherent importance of
national defense and foreign affairs makes the Departments of Defense
and State first among equals. Originating in the George Washington Administra-
tion, the War Department (as it was then known) was headed by Henry Knox,
America’s chief artillery officer in the Revolutionary War; Thomas Jefferson, the
primary author of the Declaration of Independence, was the first Secretary of State.
Despite such long and storied histories, neither department is currently living up
to its standards, and the success of the next presidency will be determined in part
by whether they can be significantly improved in short order.

“Ever since our Founding,” former acting secretary of defense Christopher Miller
writes in Chapter 4, “Americans have understood that the surest way to avoid war is
to be prepared for it in peace.” Yet the Department of Defense “is a deeply troubled
institution.” It has emphasized leftist politics over military readiness, “Recruiting
was the worst in 2022 that it has been in two generations,” and “the Biden Admin-
istration’s profoundly unserious equity agenda and vaccine mandates have taken a
serious toll.” Additionally, Miller writes that “the atrophy of our defense industrial
base, the impact of sequestration, and effective disarmament by many U.S. allies
have exacted a high toll on America’s military.” Moreover, our military has adopted
arisk-averse culture—think of masked soldiers, sailors, and airmen—rather than
instilling and rewarding courage in thought and action.

The good news is that most enlisted personnel, and most officers, especially
below the rank of general or admiral, continue to be patriotic defenders of liberty.

Mandate for Leadership: The Conservative Promise

But this is now Barack Obama’s general officer corps. That is why Russ Vought
argues in Chapter 2 that the National Security Council “should rigorously review
all general and flag officer promotions to prioritize the core roles and responsi-
bilities of the military over social engineering and non-defense related matters,
including climate change, critical race theory, manufactured extremism, and other
polarizing policies that weaken our armed forces and discourage our nation’s finest
men and women from enlisting.” Ensuring that many of America’s best and bright-
est continue to choose military service is essential.

“By far the most significant danger” to America from abroad, Miller writes, “is
China.” That communist regime “is undertaking a historic military buildup,” which

“could result in a nuclear force that matches or exceeds America’s own nuclear
arsenal.” Resisting Chinese expansionist aims “requires a denial defense” whereby
we make “the subordination of Taiwan or other U.S. allies in Asia prohibitively
difficult.” However, Miller adds that “[c]ritically, the United States must be able
to do this at a level of cost and risk that Americans are willing to bear.”

The best gauge of such willingness is congressional approval. Accordingly, we
must rediscover and adhere to the Founders’ wise division of war powers, whereby
Congress, the most representative and deliberative branch, decides whether to
go to war; and the executive, the most energetic and decisive branch, decides how
to carry it out once begun. As the past 75 years have repeatedly demonstrated in
different ways—from Korea, to Vietnam, to Iraq, to Afghanistan—we depart from
our constitutional design at our peril.

Miller writes that we “must treat missile defense as a top priority,” ensure that
more of our weapons are made in America, reform the budgeting process, and
sustain “an efficient and effective counterterrorism enterprise.” Across all of our
efforts, we must keep in mind that part of peace through strength is knowing when
to fight. As George Washington warned nearly two centuries ago, we must con-
tinue to be on guard against being drawn into conflicts that do not justify great
loss of American treasure or significant shedding of American blood. At the same
time, we must be prepared to defend our interests and meet challenges where and
when they arise.

An effective diplomatic corps is central to defending our interests and influ-
encing world events. Whereas most military personnel have had leftist priorities
imposed from above, the problem at State comes largely from within. Former
State Department director of policy planning Kiron Skinner writes in Chapter
6, “[L]arge swaths of the State Department’s workforce are left-wing and predis-
posed to disagree with a conservative President’s policy agenda and vision.” She
adds that the department possesses a “belief that it is an independent institution
that knows what is best for the United States, sets its own foreign policy, and
does not need direction from an elected President”—a view that does not align
with the Constitution.

2025 Presidential Transition Project

The solution to this problem is strong political leadership. Skinner writes, “The
next Administration must take swift and decisive steps to reforge the department
into alean and functional diplomatic machine that serves the President and, thereby,
the American people.” Because the Senate has been extraordinarily lax in fulfilling
its constitutional obligation to confirm presidential appointees, she recommends
putting appointees into acting roles until such time as the Senate confirms them.

Skinner writes that State should also stop skirting the Constitution’s trea-
ty-making requirements and stop enforcing “agreements” as treaties. It should
encourage more trade with allies, particularly with Great Britain, and less with
adversaries. And it should implement a “sovereign Mexico” policy, as our neighbor

“has functionally lost its sovereignty to muscular criminal cartels that effectively
run the country.” In Africa, Skinner writes, the U.S. “should focus on core security,
economic, and human rights” rather than impose radical abortion and pro-LGBT
initiatives. Divisive symbols such as the rainbow flag or the Black Lives Matter flag
have no place next to the Stars and Stripes at our embassies.

When it comes to China, Skinner writes that “a policy of ‘compete where we
must, but cooperate where we can’...has demonstrably failed.” The People’s Repub-
lic of China’s (PRC) “aggressive behavior,” she writes, “can only be curbed through
external pressure.” Efforts to protect or excuse China must stop. She observes,

“[M]any were quick to dismiss even the possibility that COVID escaped froma
Chinese research laboratory.” Meanwhile, Skinner writes, “[g]lobal leaders includ-
ing President Joe Biden...have tried to normalize or even laud Chinese behavior.”
She adds, “In some cases, these voices, like global corporate giants BlackRock and

Disney”—or the National Basketball Association (NBA)—“directly benefit from
doing business with Beijing.”

Former vice president of the U.S. Agency for Global Media Mora Namdar writes
in Chapter 8 that we need to have people working for USAGM who actually believe
in America, rather than allowing the agencies to function as anti-American, tax-
payer-funded entities that parrot our adversaries’ propaganda and talking points.
Former acting deputy secretary of homeland security Ken Cuccinelli says in Chap-
ter 5 that the Department of Homeland Security (DHS), a creation of the George
W. Bush era, should be closed, as it has added needless additional bureaucracy and
expense without corresponding benefit. He recommends that it be replaced with
anew “stand-alone border and immigration agency at the Cabinet level” and that
the remaining parts of DHS be distributed among other departments.

Former chief of staff for the director of National Intelligence Dustin Carmack
writes in Chapter 7 that the U.S. Intelligence Community is too inclined to look
in the rearview mirror, engage in “groupthink,” and employ an “overly cautious”
approach aimed at personal approval rather than at offering the most accurate,
unvarnished intelligence for the benefit of the country. And in Chapter 9, former
acting deputy administrator of the U.S. Agency for International Development Max

Mandate for Leadership: The Conservative Promise

Primorac asserts that the United States Agency for International Development
(USAID) must be reformed, writing, “The Biden Administration has deformed the
agency by treating it as a global platform to pursue overseas a divisive political and
cultural agenda that promotes abortion, climate extremism, gender radicalism,
and interventions against perceived systematic racism.”

If the recommendations in the following chapters are adopted, what Skinner
says about the State Department could be true for other parts of the federal gov-
ernment’s national security and foreign policy apparatus: The next conservative
President has the opportunity to restructure the making and execution of US.
defense and foreign policy and reset the nation’s role in the world. The recom-
mendations outlined in this section provide guidance on how the next President
should use the federal government’s vast resources to do just that.

—90—

DEPARTMENT OF DEFENSE
Christopher Miller

he Constitution requires the federal government to “provide for the

common defence.”! It assigns to Congress the authority to “raise and

support Armies” and to “provide and maintain a Navy”? and speci-
fies that the President is “commander in Chief” of America’s armed forces.*
Ever since our Founding, Americans have understood that the surest way to
avoid war is to be prepared for it in peace—but when deterrence fails, we must
fight and win.

The Department of Defense (DOD) is the largest part of our federal government.
It has almost 3 million people serving in uniform or a civilian capacity throughout
the world and consumes approximately $850 billion annually—more than 50 per-
cent of our government’s discretionary spending.

The DOD is also a deeply troubled institution. Historically, the military has
been one of America’s most trusted institutions, but years of sustained misuse, a
two-tiered culture of accountability that shields senior officers and officials while
exposing junior officers and soldiers in the field, wasteful spending, wildly shifting
security policies, exceedingly poor discipline in program execution, and (most
recently) the Biden Administration’s profoundly unserious equity agenda and
vaccine mandates have taken a serious toll.

Our disastrous withdrawal from Afghanistan, our impossibly muddled China
strategy, the growing involvement of senior military officers in the political arena,
and deep confusion about the purpose of our military are clear signals of a disturb-
ing decay and markers of a dangerous decline in our nation’s capabilities and will.
Additionally, more than 100,000 Americans die annually in large measure because

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Mandate for Leadership: The Conservative Promise

of illicit narcotics flows—more than four times as many people in one year as we
lost in our 20-year war against al-Qaeda.

We also are witnessing a transformation in the character of war. The democ-
ratization of technology and the collapse of time and space require dramatic,
thoughtful changes in how we defend, deter, and fight. As with any huge bureau-
cracy—and the DOD is one of the world’s largest—breaking the status quo requires
leadership and endurance. Technology is critical to maintaining our warfighting
primacy, but we must be leery of the siren song that technology alone can protect
us. More important is how new technologies are developed, tested, procured, and
used, and that relies on the true competitive advantages of our people: ingenuity,
common sense, and thoughtfulness grounded in a free society. Because war will
continue to be the most stressful and consequential human endeavor, the most
powerful weapon systems will remain the six inches between the ears of our citi-
zens and the strength of their hearts and content of their souls.

Military service is the most difficult task we ask of our citizens, and our nation is
enormously blessed that so many young, patriotic Americans eagerly volunteer to
carry such a heavy burden. We owe them everything, and we must do better. To do
better, however, means recognizing and implementing four overriding priorities:

e Priority No. 1: Reestablish a culture of command accountability,
nonpoliticization, and warfighting focus.

e Priority No. 2: Transform our armed forces for maximum effectiveness in
an era of great-power competition.

e Priority No. 3: Provide necessary support to Department of Homeland
Security (DHS) border protection operations. Border protection is a
national security issue that requires sustained attention and effort by all
elements of the executive branch.

e Priority No. 4: Demand financial transparency and accountability.

This chapter offers recommendations for improving our armed forces and the
civilian organizations that support and oversee them.

DOD POLICY

By far the most significant danger to Americans’ security, freedoms, and pros-
perity is China. China is by any measure the most powerful state in the world other
than the United States itself. It apparently aspires to dominate Asia and then, from
that position, become globally preeminent. If Beijing could achieve this goal, it
could dramatically undermine America’s core interests, including by restricting

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2025 Presidential Transition Project

U.S. access to the world’s most important market. Preventing this from happening
must be the top priority for American foreign and defense policy.

Beijing presents a challenge to American interests across the domains of
national power, but the military threat that it poses is especially acute and signif-
icant. China is undertaking a historic military buildup that includes increasing
capability for power projection not only in its own region, but also far beyond as
well as a dramatic expansion of its nuclear forces that could result in a nuclear
force that matches or exceeds America’s own nuclear arsenal.

The most severe immediate threat that Beijing’s military poses, however, is to
Taiwan and other U.S. allies along the first island chain in the Western Pacific. If
China could subordinate Taiwan or allies like the Philippines, South Korea, and
Japan, it could break apart any balancing coalition that is designed to prevent Bei-
jing’s hegemony over Asia. Accordingly, the United States must ensure that China
does not succeed. This requires a denial defense: the ability to make the subordi-
nation of Taiwan or other U.S. allies in Asia prohibitively difficult. Critically, the
United States must be able to do this at a level of cost and risk that Americans are
willing to bear given the relative importance of Taiwan to China and to the USS.

The United States and its allies also face real threats from Russia, as evidenced
by Vladimir Putin’s brutal war in Ukraine, as well as from Iran, North Korea, and
transnational terrorism at a time when decades of ill-advised military operations
in the Greater Middle East, the atrophy of our defense industrial base, the impact
of sequestration, and effective disarmament by many U.S. allies have exacted a
high toll on America’s military.

This is a grim landscape. The United States needs to deal with these threats
forthrightly and with strength, but it also needs to be realistic. It cannot wish away
these problems. Rather, it must confront them with a clear-eyed recognition of the
need for choice, discipline, and adequate resources for defense.

In this light, U.S. defense strategy must identify China unequivocally as the
top priority for U.S. defense planning while modernizing and expanding the
U.S. nuclear arsenal and sustaining an efficient and effective counterterrorism
enterprise. U.S. allies must also step up, with some joining the United States in
taking on China in Asia while others take more of a lead in dealing with threats
from Russia in Europe, Iran, the Middle East, and North Korea. The reality is
that achieving these goals will require more spending on defense, both by the
United States and by its allies, as well as active support for reindustrialization
and more support for allies’ productive capacity so that we can scale our free-
world efforts together.

Needed Reforms

e Prioritize a denial defense against China. U.S. defense planning should
focus on China and, in particular, the effective denial defense of Taiwan.

Mandate for Leadership: The Conservative Promise

This focus and priority for US. defense activities will deny China the first

island chain.

Require that all U.S. defense efforts, from force planning to employment
and posture, focus on ensuring the ability of American forces to prevail
in the pacing scenario and deny China a fait accompli against Taiwan.

Prioritize the U.S. conventional force planning construct to defeat
a Chinese invasion of Taiwan before allocating resources to other
missions, such as simultaneously fighting another conflict.

Increase allied conventional defense burden-sharing. U.S. allies must
take far greater responsibility for their conventional defense. U.S. allies

must play their part not only in dealing with China, but also in dealing with

threats from Russia, Iran, and North Korea.

Make burden-sharing a central part of U.S. defense strategy with the
United States not just helping allies to step up, but strongly encouraging
them to do so.

Support greater spending and collaboration by Taiwan and allies
in the Asia-Pacific like Japan and Australia to create a collective
defense model.

Transform NATO so that U.S. allies are capable of fielding the great
majority of the conventional forces required to deter Russia while
relying on the United States primarily for our nuclear deterrent, and
select other capabilities while reducing the U.S. force posture in Europe.

Sustain support for Israel even as America empowers Gulf partners to
take responsibility for their own coastal, air, and missile defenses both
individually and working collectively.

Enable South Korea to take the lead in its conventional defense against
North Korea.

Implement nuclear modernization and expansion. The United States
manifestly needs to modernize, adapt, and expand its nuclear arsenal.

Russia maintains and is actively brandishing a very large nuclear arsenal,

but China is also undertaking a historic nuclear breakout.

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2025 Presidential Transition Project

1. Expand and modernize the US. nuclear force so that it has the size,
sophistication, and tailoring to deter Russia and China simultaneously.

2. Develop a nuclear arsenal with the size, sophistication, and tailoring—
including new capabilities at the theater level—to ensure that
there is no circumstance in which America is exposed to serious
nuclear coercion.

e Increase allied counterterrorist burden-sharing. Transnational
terrorism remains a threat to Americans even as we pivot toward Asia.

1. Sustain the military forces needed to deter, prevent, and combat
terrorism, but at a sustainable cost in concert with other elements of
national power and partner efforts.

2. Prioritize enhancing the capability of allies and partners to take the lead
in combating terrorism in their regions.

DOD ACQUISITION AND SUSTAINMENT (A&S)

The DOD’s ability to acquire and field new and existing technologies is essential
to the ability of America’s military personnel to fight and win our nation’s wars.
To succeed in this endeavor, we must optimize the systems and personnel that
the department uses, but the inflexible bureaucratic structure and risk-adverse
culture that have developed over the decades make it difficult to provide the tools
that warfighters need at the speed of relevance.

The number one problem is the DOD budgeting process (instituted in 1961)
that requires acquisition spending to be locked years in advance. Because tech-
nologies change so rapidly and requirements can change overnight, this creates
situations in which military personnel not only go to war with outdated technol-
ogy, but also may be fighting with equipment that is less capable than that of their
competitors. America owes its military many things, and the most important is
the resources they need to survive on the battlefield and carry out the tasks we
ask of them.

Needed Reforms
e Reform the planning, programming, budgeting, and execution
(PPBE) process.

1. Enhance funding and authority for DOD mission-focused innovation

organizations and away from program-specific stovepipes that,
planned for and designed two or three years earlier, may no longer be

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Mandate for Leadership: The Conservative Promise

relevant. This allows the acquisition community to focus on portfolio
management and move money around more easily instead of being
locked into inflexible, multiyear procurement cycles.

2. The President should examine the recommendations of the
congressionally mandated Commission on Planning, Programming,
Budgeting, and Execution Reform‘ and develop a strategy for
implementing those that the Administration considers to be in the best
interests of the American people. The commission’s final report is due
on September 1, 2023.

3. Develop legislation or other means of providing funding outside the
traditional PPBE process for the prototyping and experimentation of
emerging technologies that are deemed essential to modernization and
future conflict. Consider creating a “fast track” for projects that satisfy
the most pressing national security needs.

4. Require the Under Secretary of Defense for Acquisition and
Sustainment, the Under Secretary for Research and Engineering,
and all service secretaries to conduct “Night Court” and use existing
authorities to terminate outdated or underperforming programs
so that money can be used for what works and will work. Require
the Under Secretaries and service secretaries to brief the Secretary
annually on the results.

5. Require the Office of the Secretary of Defense to research and report
on the acquisition processes used by America’s adversaries to improve
our understanding of how they are often able to innovate and field new
technologies on a faster timeline.

e Strengthen America’s defense industrial base.

1. Replenish and maintain U.S. stockpiles of ammunition and other
equipment that have been depleted as a result of U.S. support to Ukraine.
This will strengthen the defense industry supply chain and ensure that
adequate inventory exists if it is needed for a future conflict.

2. Collaborate with industry to develop a prioritized list of reforms that

the DOD and Congress can enact and implement to incentivize industry
to help America’s military innovate and field needed capabilities.

— 96 —

2025 Presidential Transition Project

3. Strengthen the ability of acquisition authorities to engage in multiyear
procurements and block buys. This will improve private-sector rates of
return, thereby incentivizing defense contractors to partner with the
government. It will also reduce government overhead by reducing the
number of procurement competitions.

4. Prioritize the U.S. and allies under the “domestic end product”
and “domestic components” requirements of the Build America,
Buy America Act.® Currently, defense companies are required to
manufacture defense items for the U.S. government that are 100
percent domestically produced and at least 50 percent composed of
domestically produced components. However, there are loopholes that
allow companies to manufacture these items overseas. This can create
supply chain and other issues, especially in wartime. Manufacturing
components and end products domestically and with allies spurs
factory development, increases American jobs, and builds resilience in
America’s defense industrial base.

5. Review the sectors currently prioritized for onshoring or
“friendshoring” of manufacturing (kinetic capabilities, castings and
forgings, critical materials, microelectronics, space, and electric vehicle
batteries); evaluate them according to the strategic landscape; and
expand or reprioritize the list as appropriate.

6. Help small businesses to become medium-size and large vendors, which
encourages a more resilient industrial base and fosters competition.
Encourage and plan for durable supply chains for small businesses
so they also have commercial/private-sector customers and are not
solely dependent on defense orders, which can be highly specialized,
expensive, and irregular.

7. Increase external engagement among small businesses to inform them
of DOD’s needs and how they could work with DOD to meet national
security priorities.

Optimize the DOD acquisition community.
1. Create incentives to emphasize speed and agility in decision-making
for prototyping and program-of-record starts and terminations.

Most bureaucrats would rather follow a checklist and fail than go
outside the procedures and win because failure means negative

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career repercussions. Senior acquisition leaders should design a
system that allows decision-makers to stay within the law but bypass
unnecessary departmental regulations that are not in the best interest
of the government and hamper the acquisition of capabilities that
warfighters require.

2. The Under Secretary of Defense for Acquisition and Sustainment,
Under Secretary for Research and Engineering, and all service
secretaries should assess their acquisition workforces; determine what
additional personnel, resources, and training they need; and develop
implementation plans. The goal is to develop, prototype, acquire, and
field required capabilities at the speed of relevance to meet America’s
pacing threats and maintain a warfighting advantage.

3. Decentralize Defense Acquisition University (DAU) offerings and
expand the DAU mission to include accreditation of non-DOD
institutions. The critical shortage of trained and certified acquisition
personnel must be addressed with urgency in order to support DOD
mission objectives and goals. With the rapid evolution of training and
educational technologies, including remote and virtual practices, there
is no reason for DAU to maintain a monopoly on the knowledge and
certification that are required to perform as acquisition professionals.
Further, the cost to private contractors and non-DOD civilians who
aspire to such a role limits the supply of trained and certified candidates.
DAU has become an unnecessary barrier to entry in a career field that is
vital to the DOD mission.

DOD RESEARCH, DEVELOPMENT, TEST, AND EVALUATION (RDT&E)
The FY 2017 National Defense Authorization Act established the position of
Under Secretary of Defense for Research and Engineering and assigned broad
responsibility for “all defense research and engineering, technology develop-
ment, technology transition, prototyping, experimentation, and developmental
testing activities and programs, including the allocation of resources for defense
research and engineering, and unifying defense research and engineering efforts
across the Department,” to the new Under Secretary, who also was tasked with
“serving as the principal advisor to the Secretary on all research, engineering,
and technology development activities and programs in the Department.”° This
led to the single largest DOD structural change since the Goldwater-Nichols
act of 1986’ and was organized effectively during President Donald Trump’s
Administration.

2025 Presidential Transition Project

Needed Reforms

Champion, engage, and focus the American innovation ecosystem.
To maintain leadership in the era of great-power competition and
succeed against our adversaries, a key DOD effort must be the creation
of mechanisms and processes to embrace America’s most significant
competitive advantage: innovation.

Engage and leverage all of America’s scientific, engineering, and high-
tech production communities to research, develop, prototype, and
rapidly deploy advanced technology capabilities on a continuing basis to
preserve our warfighting advantage.

Increase integration and collaboration among the DOD, government labs,
and private companies to solve the department’s most difficult problems.

Reduce the number of critical technology areas from 14 to a more
manageable number to concentrate effort and resources on those that
bear directly on great-power competition.

Rebuild RDT&E infrastructure that resides in Cold War-era facilities
and is not well-suited to the current era of rapid development and
testing of advanced technology and concepts to the maturity level
necessary for acquisition and operational fielding.

Move toward a much more comprehensive independent risk-reduction
approach to increase understanding of the technical risks by drawing
on the expertise in DOD laboratories and agencies to help acquisition

programs succeed.

Improve the rapid deployment of technology to the battlefield.
America’s military advantage has derived from the professionalism of our
servicemembers and our ability to manifest our technological advantage
in battlefield capability. The current era of great-power competition will
continue for the foreseeable future, and technology will be the currency of
competition. Our ability to prevail will rest on our ability to develop new
technologies and move them onto the battlefield more rapidly than our
adversaries can.

1. Accelerate the prototyping cycle to meet immediate battlefield needs.

2. Require tighter integration with user communities to provide value.

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Mandate for Leadership: The Conservative Promise

3. Establish a pipeline of near-term, mid-term, and long-term technology
that is aimed at great-power competition (China) and can be matured,
prototyped, and evaluated to support major acquisitions (the ability to
produce at scale) to break the cycle of schedule delays and cost overruns
from underdeveloped and poorly understood technologies.

e Develop a framework to protect the RDT&E enterprise from foreign
exploitation. Strategic competition and adaptive adversaries require new
thinking about how to protect technology. China has been relentless in
stealing U.S. technology, using the full range of measures from influence
operations to outright theft. This has been a major factor in its ability to
close the gap and in some cases to exceed U.S. capabilities.

1. Implement acomprehensive approach to preserving U.S. technological
leadership that is based on outpacing our adversaries; clear about what we
need to protect; tailored to various specific sectors (for example, academia,
the defense industrial base, and laboratories); and underpinned with a full
range of consequences for attempted or actual theft.

DOD FOREIGN MILITARY SALES

The United States must regain its role as the “Arsenal of Democracy.” In fiscal
year (FY) 2021, U.S. government foreign military sales (FMS) nosedived to alow of
$34.8 billion from a record high of $55.7 billion in FY 2018.° This decrease hinders
interoperability with partners and allies, decreases defense industrial base capac-
ity, and increases the taxpayer burden on the U.S. military’s own procurements.
Under previous Administrations, the United States built its reputation as a reliable
partner with a strong defense industrial base that could supply military articles
and goods in a timely manner. Today’s FMS process is encumbered by byzantine
bureaucracy, long contracting times, high costs, and mundane technology.

The United States can change this downward trajectory by improving inter-
nal processes that incentivize partners and allies to procure U.S. defense systems,
thereby expanding our “defense ecosystem.” We must reverse the recent dip in
FMS to ensure both that our partners remain interoperable with the United States
and that our defense industrial base regains much-needed capacity in preparation
for future challenges.

Needed Reforms

e Emphasize exportability with U.S. procurements. The record-low
FMS sales in 2021 were driven partly by the high costs of converting
weapon systems on the back end of production rather than emphasizing
exportability in initial capability planning.

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2025 Presidential Transition Project

1. Ensure that senior U.S. military leadership emphasizes exportability in
the initial development of defense systems that are both available and
interoperable with our partners and allies.

2. Create a funding mechanism to incentivize exportability in initial
planning, which can be recouped after future FMS transactions.

End informal congressional notification. Informal congressional
notification or “tiered review” is a hinderance to ensuring timely sales to
our global partners. The tiered review process is not codified in law; it is
merely a practice by which the Department of State provides a preview of
prospective arms transfers before Congress is formally notified.’

1. End the tiered review process to eliminate at least 20 days from the
FMS process.

2. Use the tiered review process only when unanimous congressional
support is guaranteed in order to eliminate the “weaponization” by
select Members of Congress that has prevented billions of dollars of
arms sales from moving into formal congressional notification.

Minimize barriers to collaboration. The high cost of developing
advanced defense platforms requires the United States to collaborate with
key allies to minimize waste, complement strengths, and supplement our
defense industrial base to create a system that is greater than that of the
United States alone.

1. Enhance defense industrial base planning with partners to allow
them to focus on niche areas where there are cost advantages for the
United States.

2. Decrease International Traffic in Arms Regulations (ITAR) to facilitate
trade with such allies as the United Kingdom, Canada, and Australia.

3. Create opportunities to improve the health of the defense supply chain
with added opportunities for partners and allies to contribute.

Reform the FMS contracting process. The contracting timeline for the
FMS process is shockingly slow. On average, the DOD contracting timeline
takes approximately 18 months because of slow bureaucratic processes and
chronic understaffing.””

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Mandate for Leadership: The Conservative Promise

1. Immediately fund more contracting capacity in all services to decrease
the contracting timeline and improve the delivery of defense articles to
our global partners.

2. Rationalize and speed arms sales decision-making to preclude our
enemies from exploiting bureaucratic slothfulness and allow us to
manage the development of indigenous defense industrial bases.

DOD PERSONNEL

The men and women of America’s armed forces are the most critical component
of our national defense strategy, but in recent years, they have been overextended,
undervalued, and insufficiently resourced. Their families help them to carry the
burden of service, but the assistance they receive is disproportionately less than
the sacrifices they make. Young civilians who would thrive in a military environ-
ment are disenfranchised when educators and influencers discourage them from
learning about military service and preparing for the honor of wearing Ameri-
ca’s uniform.

The United States military is an extraordinary institution, staffed by exceptional
people who have defended our nation and changed the course of history, but the
Biden Administration, through word and deed, has treated the armed forces as just
another place to work. We must restore our military to a place of honor and respect
and recruit and retain the individuals who will meet the rigorous standards of
excellence that are required for membership in the world’s greatest fighting force.

Needed Reforms

e Rescue recruiting and retention. Recruiting was the worst in 2022 that it
has been in two generations and is expected to be even worse in 2023. Some
of the problems are self-inflicted and ongoing. The recruiting problem is not
service-specific: It affects the entire Joint Force.

1. Appoint a Special Assistant to the President who will maintain liaison
with Congress, DOD, and all other interested parties on the issue of
recruiting and retention.

2. Improve recruiting by suspending the use of the recently introduced
MHS Genesis system that uses private medical records of potential
recruits at Military Entrance Processing Stations (MEPS), creating
unnecessary delays and unwarranted rejections.”

3. Improve military recruiters’ access to secondary schools and require
completion of the Armed Services Vocational Aptitude Battery

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2025 Presidential Transition Project

(ASVAB)—the military entrance examination—by all students in schools
that receive federal funding.”

4. Encourage Members of Congress to provide time to military recruiters
during each townhall session in their congressional districts.

5. Increase the number of Junior ROTC programs in secondary schools.

Restore standards of lethality and excellence. Entrance criteria for
military service and specific occupational career fields should be based on
the needs of those positions. Exceptions for individuals who are already
predisposed to require medical treatment (for example, HIV positive

or suffering from gender dysphoria) should be removed, and those with
gender dysphoria should be expelled from military service. Physical
fitness requirements should be based on the occupational field without
consideration of gender, race, ethnicity, or orientation.

Eliminate politicization, reestablish trust and accountability, and
restore faith to the force. In 2021, the Reagan National Defense Survey
found that only 45 percent of Americans have “a great deal of trust and
confidence in the military”—down from 70 percent in 2018."

1. Strengthen protections for chaplains to carry out their ministry
according to the tenets of their faith.

2. Codify language to instruct senior military officers (three and four
stars) to make certain that they understand their primary duty
to be ensuring the readiness of the armed forces, not pursuing a
social engineering agenda. This direction should be reinforced
during the Senate confirmation process. Orders and direction
motivated by purely partisan motives should be identified as
threats to readiness.

3. Reinstate servicemembers to active duty who were discharged for
not receiving the COVID vaccine, restore their appropriate rank, and
provide back pay.

4. Eliminate Marxist indoctrination and divisive critical race theory

programs and abolish newly established diversity, equity, and inclusion
offices and staff.

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Mandate for Leadership: The Conservative Promise

5. Restrict the use of social media solely for purposes of recruitment and
discipline any armed services personnel who use an official command
channel to engage with civilian critics on social media.

6. Audit the course offerings at military academies to remove Marxist
indoctrination, eliminate tenure for academic professionals, and
apply the same rules to instructors that are applied to other DOD
contracting personnel.

7. Reverse policies that allow transgender individuals to serve in the
military. Gender dysphoria is incompatible with the demands of military
service, and the use of public monies for transgender surgeries or to
facilitate abortion for servicemembers should be ended.

Value the military family. Military service requires extreme sacrifices
by families.

1. Support legislation to increase wages and family allowances for active-
duty enlisted personnel. No uniformed personnel should ever have to
rely on social benefits like as food stamps or public housing assistance.

2. Improve base housing and consider the military family holistically when
considering change-of-station moves.

3. Improve spouse employment opportunities and protections, including
licensing reform,“ and expand childcare.

4. Auditall curricula and health policies in DOD schools for
military families, remove all inappropriate materials, and reverse
inappropriate policies.

5. Support legislation giving education savings account options to
military families.

Reduce the number of generals. Rank creep is pervasive. The number
of 0-6 to 0-9 officers is at an all-time high across the armed services
(above World War II levels), and the actual battlefield experience of this
officer corps is at an all-time low. The next President should limit the
continued advancement of many of the existing cadre, many of whom
have been advanced by prior Administrations for reasons other than their
warfighting prowess.

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2025 Presidential Transition Project

DOD INTELLIGENCE

Our national defense establishment must evolve to meet the rapid, pro-
found, and dynamic change in the global landscape, but absent significant effort
to evaluate and retool in critical areas—including our intelligence and security
portfolios—America’s competitive advantage against rivals and adversaries is at
serious risk. However, for any structural changes to succeed, the crisis in our Intel-
ligence Community (IC)/Defense Intelligence Enterprise (DIE) leadership must
be addressed.”

The DIE accounts for the bulk of the Intelligence Community’s personnel and a
significant portion of its budget. Of the IC’s 17 elements, eight are within DOD,” two
are independent, and seven belong to various other departments and agencies.”
Overall, “[t]he DoD provides 86 percent of the personnel who conduct intelligence
activities, both military and civilian.””°

The Defense Intelligence Enterprise must deliver accurate, unbiased, and
timely insights consistently and with clarity, objectivity, and independence. If they
continue on their current path, however, both the DIE and the Intelligence Com-
munity writ large will continue to provide inaccurate and politicized intelligence
assessments that mislead policymakers.

Needed Reforms

e Improve the intelligence process. Defense intelligence assets have been
committed to the prosecution of operational campaigns since September 11,
2001, at the expense of our strategic objectives, and this has led to increased
risk.” Further, the DIE has evolved into a “customer-based” model with
the DIE/IC trying to be supportive of policy direction at the expense
of analytical integrity. The result has been a significant politicization of
intelligence.

1. Establish unbiased intelligence reporting from DIE/IC senior leaders.
As the leader of the DIE, the Under Secretary of Defense for Intelligence
and Security should provide a top-line, dissenting, or clarifying view of
DIE and IC assessments as needed.

2. Align collection and analysis with vital national interests (countering
China and Russia).

3. Establish an effective global federated intelligence framework
with allies and partners and our Combatant Commands. Avoid the
temptation to neglect areas that appear less pertinent but that support
aconvergence of threats and the critical requirements to sustain
those threats.

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Mandate for Leadership: The Conservative Promise

4. Establish and sustain feedback loops to provide insight and direction
for continuous improvement and accountability.”* We must revisit
our assessments and understand where we got it right and where we
got it wrong.

5. Better exploit publicly available information (PAI) data and foster
innovation to improve collection and analysis. We must end the practice
of multiple DIE organizations paying to acquire the same PAI data and
invest more in machine learning (ML) and artificial intelligence (AD) to
exploit open-source and classified intelligence data.

6. Remove policy obstacles that impede available technical solutions
and tailored approaches in order to preclude corruption at the point
of collection.

7. Develop statistical discrimination techniques based on relative value
to deal with the volume and velocity of available data and information,
which are rapidly exceeding our ability to exploit and analyze available
data and information efficiently.

Expand the integration of intelligence activities. The prevalence of
asymmetric warfare requires Defense Intelligence to leverage the unique
authorities and capabilities of U.S. departments and agencies, as well as our
partners and allies, to competitive advantage.

1. Create an improved cyber defense and capability. We must reevaluate
the dual-hat structure between the National Security Agency (NSA) and
U.S. Cyber Command (USCYBERCOM).

2. Resurrect economic analysis capability to improve our ability to counter
Chinese whole-of-government strategies that combine security with
predatory economic objectives.

3. Resurrect critical thinking to provide true strategic intelligence that will
enable the U.S. to counter global adversaries and emerging technologies
(such as adversary advances in hypersonics, Unmanned Aerial Systems
(UAS), cyber domain, advanced fighter aircraft, and advanced undersea
capabilities) more effectively.

4. Rebuild human intelligence (HUMINT) and counterintelligence (CI) and
improve their integration with defensive and offensive cyber operations.

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2025 Presidential Transition Project

5. Establish true alignment between DOD and DHS both to improve the
defense of critical U.S. infrastructure and national border integrity
and to develop vital information that enables defense against foreign
targeted disruptions.”

Restore accountability and public trust. In recent years, public trust in
Defense Intelligence has been eroded by, for example, flawed assumptions
leading up to our Afghanistan withdrawal, flawed Russia-Ukraine
assessments, divergences in relations with key Gulf allies, and voids being
filled by Russia and China around the world. For trust to be restored and
sustained, officials must be held accountable.

1. Restore DIE critical thinking. Establish mechanisms to restore analytic
integrity and return to true intelligence-driven operations. The next
Administration should eliminate the conflict of interest in the current
customer-based model (in which the customer is always right) by
enforcing time-tested procedures that guarantee independent analysis,
even if it means challenging policymakers’ assumptions. The Under
Secretary of Defense for Intelligence and Security’s leadership role
should be expanded to include providing analytic top-line views and
improve DIE transparency by highlighting diverging views.

2. Elevate the DIE’s voice in national policy discussions, commensurate
with the DIE’s 75 percent share of the IC budget. Present defense
intelligence to senior policymakers, either independently to
avoid all-source bias or in consensus products like the National
Intelligence Estimates.

Eliminate peripheral intelligence obligations that do not advance
military readiness. In 2019, following the catastrophic 2015 data

breach at the US. Office of Personnel Management (OPM), the Defense
Counterintelligence and Security Agency (DCSA) accepted transfer of the
responsibility to conduct security clearance and suitability investigations
for 95 percent of the U.S. government’s civilian workforce. This decision,
which grew out of an intention to deconstruct OPM, was wrongheaded on
many levels and made the federal bureaucracy dependent on a new overlay
of DOD bureaucracy, in a sense instilling DOD control of civilian managers.
This function should be returned to OPM except for military security
clearance investigations.

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Mandate for Leadership: The Conservative Promise

U.S. ARMY

The US. Army’s mission is “[t]o deploy, fight and win our nation’s wars by pro-
viding ready, prompt and sustained land dominance by Army forces across the full
spectrum of conflict as part of the joint force.” Today, however, the Army cannot
execute its land dominance mission.” The U.S. Army is at an inflection point that
is marked by more than a decade of steadily eroding budgets and diluted buying
power, an appreciable degradation in readiness and training capacity, a near crisis
in the recruiting and retention of critical personnel, and a bevy of aging weapons
systems that no longer provide a qualitative edge over peer and near-peer com-
petitors but will not be replaced in the near term.

All of these challenges are set against the backdrop of a complex and dynamic
global geopolitical environment that is exemplified and exacerbated by the triumph
of our adversaries in Afghanistan after a 20-year struggle there as well as recent
Russian outrages in the Ukraine and China’s bellicosity both on its borders and in
surrounding disputed regions. In spite of these ever-increasing operational pulls, our
Army is consistently being asked to do more with fewer resources. The status quo
is further marked by a pervasive politically driven top-down focus on progressive
social policies that emphasize matters like so-called diversity, equity, and inclusion
and climate change, often to the detriment of the Army’s core warfighting mission.

Needed Reforms

e Rebuild the Army. The total Army budget has decreased by roughly 11
percent since 2018, perilously affecting the service’s readiness and ability to
train and to procure new personnel and equipment. Declining budgets and
decreased buying power have forced the Army to lower training standards
and opportunities to train, propose reductions in end strength, slash
military construction programs to historically low levels, and scale back
essential modernization programs.

1. Increase the Army budget to remain the world’s preeminent land power.
2. Accelerate the development and procurement of the six current
Army modernization priorities (long-range precision fires, the Next-
Generation Combat Vehicle, Future Vertical Lift, the Army network,
air and missile defense, and soldier lethality) to replace worn out and
outdated combat systems and ensure ground combat dominance.
3. Increase funding to improve Army training and operational readiness.
4. Increase the Army force structure by 50,000 to handle two major

regional contingencies simultaneously.

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2025 Presidential Transition Project

5. Reform recruiting efforts. The Army missed its 2022 recruitment goal
by 25 percent, or 15,000 soldiers.

Focus on deployability and sustained operations. The U.S. Army’s
very lethal ground force capability is irrelevant if it cannot quickly deploy
to locations for employment in decisive operations to secure our global
security interests. Additionally, Army logisticians provide the ground
transportation (of both personnel and equipment); fuel, food, and water;
munitions (bombs and bullets); medical supplies and services; and
veterinary services (food safety) that are critical to sustainment of the
other services.

1. Immediately increase the production and stockpiling of critical
munitions and repair parts.

2. Prioritize expeditionary logistics in all force design and operational
planning to guarantee entry into a contested theater of war.

3. Increase the level of Joint Force training, synchronization, and
coordination focused on logistics.

4. Prepare to deploy forces from degraded U.S.-based transportation
infrastructure that is compromised by opposing forces.

Transform Army culture and training. The Army can no longer serve

as the nation’s social testing ground. A rebuilt Army that is focused again
on its core warfighting mission and empowered it with the tools, resources,
and authorities it needs to accomplish that mission must be the next
Administration’s highest defense priority.

1. Stop using the Army as a test bed for social evolution. Misusing the
Army in this way detracts from its core purpose while doing little to
reshape the American social structure. The Army no longer reflects
national demographics to the degree that it did before 1974 when the
draft was eliminated.

2. Demand accountability in senior leaders to reverse the decline in public
support for military service.

3. Reestablish the experiential base for the planning, execution, and
leadership of Army formations in large-scale operations. Currently,

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Mandate for Leadership: The Conservative Promise

there are no general or field-grade officers who served as planners or
commanders against a near-peer adversary in combat.

4. Examine the logic of emerging Army concepts about employing massed
long-range fires and effects without considering how to gain advantage
by closing with and dominating an adversary on land.

5. Recognize that high-intensity land combat operations cannot be
sustained through short-term individual or unit rotations in the style of
the sustained low-intensity campaigns conducted over the past 20 years.

6. Transform how the National Guard is employed during extended
operations short of declared war to preclude back-to-back federal and
state deployments of National Guard soldiers in order to stabilize and
preserve military volunteerism in our communities.

7. Revamp Army school curricula to concentrate on preparation for large-
scale land operations that focus on defeating a peer threat.

8. Address the underlying causal issues driving increasing Army suicide
rates, which have surpassed pre-World War II rates and are now
eclipsing the rate among civilians.

U.S. NAVY

As noted at the beginning of this chapter, the U.S. Constitution gives Congress
the power to “provide and maintain a Navy.” Inherent in this phrase is arecognition
that there is a vital national interest in the maritime environment and that this
national interest requires sustained planning and investment. This is as true today
as it was almost 250 years ago and will remain true into the future.

The U.S. Navy (USN) exists for two primary reasons: to project prompt, sus-
tained, and effective combat power globally, both at sea and ashore, and to deter
aggression by potential adversaries by maintaining a forward operating presence
in conjunction with allies and partners. Today, the People’s Republic of China Peo-
ple’s Liberation Army Navy (PLAN) can challenge the USN’s ability to accomplish
its mission in the Pacific and Indian Oceans.

Inthe production, employment, and control of maritime forces, the USN must
consider the scope and rate of technological change and, where appropriate, adapt
its processes and workforce development. In balancing the necessary long-term
industrial model of naval platforms against emerging short-term opportunities,
the USN must take account of advances that may present vulnerabilities and risks
as well as what is assured and secure.

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2025 Presidential Transition Project

Needed Reforms

Invest in and expand force structure. The USN’s organizing principle
remains platform-centered: vessels manned by sailors. The manned surface
and subsurface forces act in concert with land-based, air-based, and space-
based forces to project power outside sovereign territory, principally by
operating in international waters. Investments must be closely coordinated
with these other elements of military power.

1. Builda fleet of more than 355 ships.”°
2. Develop and field unmanned systems to augment the manned forces.

3. Require that range and lethality be the key factors in all procurement
and sustainment decisions for ships, aircraft, and munitions.

Reestablish the General Board. In contrast with the Navy General
Board that served ship development so well during the interwar period,
the current joint process” for defining the requirements for major
defense acquisitions is not well-suited to long-term planning of the
sort that is needed for USN fleet architecture and shipbuilding. The
interwar General Board should serve as a model, empowered with

final decision authority over all requirements documents concerning
ships and the major defense systems fielded on ships. The individual
board members would ensure a broad base of knowledge as well as
independent thinking.”®

Establish a Rapid Capabilities Office. The USN must transition
technology into warfighting capability more rapidly. It must foster a culture
of innovation that includes connecting theoretical and intangible ideas with
real production environments that produce tangible and practical outcomes
and adapting proven processes to advance material solutions.

1. Harness innovation and willingness to tolerate risk so that “good
enough” systems can be fielded rapidly.

2. Use the Space Development Agency as a model.
3. Establish an oversight Board of Directors made up of the service chief,

service secretary, and Under Secretary of Defense for Acquisition and
Sustainment.

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Mandate for Leadership: The Conservative Promise

Accelerate the purchase of key munitions. It takes years to build and
maintain navies but only hours to expend their ordnance in combat. The
USN must be prepared to expend large quantities of air-launched and
sea-launched stealthy, precision, cruise missiles against targets both at
sea and ashore. Additionally, modern air defense requires the use of high-
performance surface-to-air missiles.

1. Produce key munitions at the maximum rate with significant capacity.

2. Working with the Congress, employ the widest possible range of
techniques to enhance the munitions supply chains and workforce.

Enhance warfighter development. The USN requires a variety of
documented qualifications for personnel to advance in their careers and
assume leadership positions. It also requires individual professional
qualifications that are focused on warfighting.

1. Mandate qualifications that demonstrate an understanding of core
competence in collective, integrated warfighting, especially based on
current plans and technologies.

2. Elevate the Headquarters Staff focused on Warfighter Development
(N7) within the Office of the Chief of Naval Operations (OPNAV) and
empower it to develop such requirements.

3. Require that war games be utilized as experiential learning environments
for the participants as a prerequisite for achieving career milestones
(department heads, commanding officers, and major commanders).

4. Highlight in training and leader development that USN forces can and
must maintain the ability to operate from and/or defend sovereign
territory to include our allies and partners.

5. Train to balance effects from kinetic to nonkinetic and from lethal to
nonlethal through effective command and control.

U.S. AIR FORCE

The U.S. Air Force today lacks a force structure with the lethality, survivabil-

ity, and capacity to fight a major conflict with a great power like China, deter

nuclear threats, and meet its other operational requirements under the National

Defense Strategy.’ For 30 years, the Air Force has received less annual funding

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2025 Presidential Transition Project

(if pass-through funding, defined as money in the Air Force budget that does not
go to the Air Force, is removed from the equation) than the Army and Navy have
received. This underfunding has forced the Air Force to cut its forces and forgo
modernizing aging weapons systems that were never designed to operate in current
threat environments and are structurally and mechanically exhausted. The result
is an Air Force that is the oldest, smallest, and least ready in its history.

The decline in Air Force capacity and capability is occurring at the same time
the security environment demands the very options that the Air Force uniquely
provides. Combatant commanders routinely request more Air Force capabilities
than the service has the capacity to provide. The Air Force today simply cannot
accomplish all of the missions it is required to perform.

The Air Force has consistently stated on the official record that it is not sized to
meet the mission demands placed on it by the various U.S. Combatant Commands.
A 2018 study, “The Air Force We Need,”*° showed a 24 percent deficit in Air Force
capacity to meet the needs of the National Defense Strategy. Those conclusions
remain valid and are more pronounced today because of subsequent aircraft retire-
ments. The demand is also higher because of world events. To understand these
trends, one needs only to consider that the Air Force’s future five-year budget plan
retires 1,463 aircraft while buying just 467. This makes for a reduction of 996 air-
craft by 2027. The net result is a force that is smaller, older, and less ready at a time
when demand is burgeoning.

Needed Reforms

e Increase spending and budget accuracy in line with a threat-based
strategy. Returning the U.S. military to a force that can achieve deterrence
or win in a fight if necessary requires returning to a threat-based defense
strategy. Real budget growth combined with a more equitable distribution
of resources across the armed services is the only realistic way to create a
modernized Air Force with the capacity to meet the needs of the National
Defense Strategy. Additionally, as noted above, pass-through funding causes
numbers cited in current DOD budget documents to be higher than the
dollar amounts actually received by the Air Force.

1. Adopt atwo-war force defense strategy with scenarios for each service
that will allow the Air Force to attain the resources it requires by
developing a force-sizing construct that reflects what is required to
accomplish strategic objectives.

2. Eliminate pass-through funding, which has grown to more than

$40 billion per year and has caused the Air Force to be chronically
underfunded for decades.

— 113 —

Mandate for Leadership: The Conservative Promise

Increase the Air Force budget by 5 percent annually (after adjusting for
inflation) to reverse the decline in size, age, and readiness and facilitate
the transition to a more modern, lethal, and survivable force.

Reduce near-term and mid-term risk. Increasing the Air Force’s
acquisition of next-generation capabilities that either are or soon will be in

production will increase the ability of the United States to deter or defeat

near-term to mid-term threats.

Increase F-35A procurement to 60-80 per year.

Build the capacity for a B-21 production rate of 15-18 aircraft per year along
with applicable elements of the B-21 long-range strike family of systems.

Increase Air Force airlift and aerial refueling capacity to support agile
combat employment operations that generate combat sorties froma
highly dispersed posture in both Europe and the Pacific.

Develop and buy larger quantities of advanced mid-range weapons (50
nm to 200 nm) that are sized to maximize targets per sortie for stealth
aircraft flying in contested environments against target sets that could
exceed 100,000 aimpoints.

Accelerate the development and production of the Sentinel
intercontinental ballistic missile to reduce the risk inherent in an aging
Minuteman III force in light of China’s nuclear modernization breakout.

Increase the number of EC-37B electronic warfare aircraft from 10 to 20
in order to achieve a minimum capacity to engage growing threats from
China across the electromagnetic spectrum.

Invest in future Air Force programs and efforts. Increasingly capable

adversaries require new capabilities to enable victory against those adversaries.

Attain an operationally optimized advanced battle management system
as the Air Force element of the DOD Joint All Domain Command and
Control enterprise.

Produce the next-generation air dominance system of systems (air

moving target indication, other sensors, communications, command
and control, weapons, and uninhabited aerial vehicles).

—114—-

2025 Presidential Transition Project

3. Achieve moving target engagement capability and capacity against sea,
surface, and ground mobile targets at the scale necessary to meet the
needs of the National Defense Strategy.

4. Build resilient basing, sustainment, and communications for
survivability in a contested environment.

5. Establish a vigorous and sufficiently funded electromagnetic spectrum
operations recovery plan to make up for more than 20 years of neglect of
this mission area.

U.S. MARINE CORPS

The U.S. Marine Corps (USMC) is the maritime land force of the Department
of Defense and Department of the Navy. It serves a critical role as an expedition-
ary amphibious force that can project power from sea to shore and beyond while
performing other specialized missions like securing America’s diplomatic out-
posts abroad.

Between the terrorist attacks of September 11, 2001, and the conclusion of U.S.
military operations in Afghanistan in August 2022, the Marine Corps engaged
in extended operations ashore as directed by the Secretary of Defense, leaving it
with little opportunity or ability to train for and execute the naval and amphibious
operations for which it is uniquely suited and directed by law. This lengthy diver-
gence from its primary mission led to deep concern that the Corps had become a

“second land army,” prompting senior Marine Corps leaders to push for the service
to return to the sea. In addition, the USMC spent nearly two decades fighting coun-
terinsurgency wars in Afghanistan and Iraq and developed capabilities that were
specifically geared to those fights but have limited utility in scenarios involving
evenly matched and advanced enemies or amphibious operations that are neces-
sary for the projection of naval power.

As aresult, Marine Corps Commandant General David H. Berger developed
and began to implement Force Design 2030," a plan that, if completed, would be
the most radical transformation of the Marine Corps since World War II. The suc-
cessful implementation of this force redesign, coupled with reforms in the Marine
Corps’ personnel system and the Navy’s amphibious shipbuilding plans, will be
critical to ensuring the Corps’ future combat effectiveness.

Needed Reforms

e Divest systems to implement the Force Design 2030 transformation.”
Divesting equipment that is less relevant to distributed, low-signature
operations in a contested maritime environment will make funds available
for modernization.

— 115 —

Mandate for Leadership: The Conservative Promise

Transform USMC force structure.

Eliminate all USMC law enforcement battalions.

Transform at least one Marine Infantry Regiment into a Marine
Littoral Regiment.

Reduce the size of remaining infantry battalions.

Divest systems or equipment that are better suited to heavier
US. Army units.

Maintain divestment of M1 Abrams tanks.

Eliminate the majority of tube artillery (M777) batteries.

Reduce the number of Advanced Amphibious Assault Vehicles and
the number of their replacements.

Use funds made available by divestment of systems to support new
systems that are geared to the likely needs of future conflicts.

Increase the number of rocket artillery batteries CHIMARS).
Increase the number of upgraded Light Armored Vehicle
(LAV) companies.

Increase the number of Unmanned Aerial Systems and anti-air
systems (including counter-UAS systems).

Develop long-range strike missiles and anti-ship missiles for the Corps.

Modernize USMC infantry equipment.

Transform the USMC personnel paradigm. More than other services,
the USMC relies heavily on junior noncommissioned officers (NCOs) to staff

key positions across the force but especially in combat arms. For example,

E-4s routinely hold squad leader billets when the Army normally has E-6s in

those billets. The nature of more distributed operations and the increasingly

complex responsibilities of a Marine Corps rifle squad and platoon under

Force Design 2030 will only put more responsibility on the backs of squad

leaders and platoon sergeants, increasing the need for more senior Marines

in those critical positions. Additionally, the Corps needs to improve its

retention of junior NCOs after their first enlistments (the Marines have

much lower rates of reenlistment than other branches).**

Align the USMC’s combat arms rank structure with the U.S. Army’s (squad
leader billets are for E-6s, and platoon sergeant billets are for E-7s).

— 16 —

2025 Presidential Transition Project

2. Create better incentives to retain talented junior NCOs, especially in
infantry and other critical military occupational specialties.

3. Reduce unnecessary deployments to increase dwell time in order to
enable more robust primary military education.

e Align Navy amphibious shipbuilding with Force Design 2030. The U.S.
Navy has struggled for decades to maintain an amphibious fleet that could
support USMC war plans around large-scale amphibious operations. In
addition, amphibious shipbuilding has often had to compete against other
priorities within a constrained budget and limited shipbuilding capacity.

1. Develop and produce light amphibious warships (LAWs) to support
more distributed amphibious operations, especially in the Pacific.**

2. Maintain between 28 and 31 larger amphibious warships as opposed to
the 25 specified in current Navy shipbuilding plans and the 38 specified
before 2020.*°

U.S. SPACE FORCE

US. space forces conduct global space operations to sustain and enhance air,
land, and sea effectiveness, lethality, and superiority by providing secure broad-
band global communications (precision position, navigation, and timing accuracy);
attack warning and threat tracking and targeting capability (real-time intelligence,
surveillance, and reconnaissance information); and their assured continuity of
operations both by defending U.S. assets and by conducting offensive operations
that are capable of imposing unacceptable losses on adversaries that might seek
to attack them.

The U.S. Space Force (USSF) was established to assure continuous global and
theater combat support from space, to deter attacks against U.S. space assets, and
to prevail in space should deterrence fail. The USSF posture was conceived as a
balance of offensive and defensive deterrent capabilities designed for maximum
effectiveness.

Needed Reforms

e Reverse the Biden Administration’s defensive posture. The Biden
Administration has eliminated almost all offensive deterrence capabilities
and instead will rely solely on defensive capabilities of disaggregation,
maneuver, and reconstitution—the most costly, the slowest, and ultimately
the most fragile architecture selection.

— 17 —

Mandate for Leadership: The Conservative Promise

1. Reestablish offensive capabilities to guarantee a favorable balance of
forces, efficiently manage the full deterrence spectrum, and seriously
complicate enemy calculations of a successful first strike against U.S.
space assets.

2. Restore architectural balance in U.S. space forces, both offensive and
defensive, to restore deterrence dominance efficiently and quickly.

3. Rapidly expand space control capability, to include cis-lunar space (the
region beginning at geosynchronous altitude and encompassing the
moon), to provide early warning of an enemy attack.

4. Seek arms control and “rules of the road” understandings only when
they are unambiguously in the interests of the U.S. and its allies, and
prohibit their unilateral implementation.

Reduce overclassification. The USSF must move beyond the Cold War-
era culture of secrecy and overclassification that surrounded military space
to facilitate greater coordination and synchronization of efforts across the
government and commercial sectors.

Declassify appropriate information about terrestrial and on-orbit space
capabilities that threaten the U.S. space constellation, as well as those
being pursued by our competitors, to secure the principled right to
counter them offensively.

Implement policies suited to a mature USSF. No longer a “newborn,” the
USSF has entered its fourth year of existence, and the lessons learned can be
incorporated across all facets of the force to increase its effectiveness.

1. Restructure from the current “unity of effort” structure to “unity
of command.”

2. Lead the U.S. government’s development of a clear and unambiguous
declaratory policy that the United States will operate at will in space
and enforce these operations with capabilities that ensure effective
deterrence and the ability to impose our will if necessary.

3. End the current study phase of concept development and issue

necessary guidance for the development and fielding of offensive
capabilities.

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2025 Presidential Transition Project

Alter the Space Development Agency’s current “fail-early” approach
and transition to a methodology that maintains aggressive timelines but
with significantly greater engineering rigor, with special attention to
sustainment, support, and fully integrated space operations.

Increase the number of general officer positions to ensure the Space
Force’s ability to compete for resources on acommon basis with the
other services.

Explore creation of a Space Force Academy to attract top aero-astro
students, engineers, and scientists and develop astronauts. The academy
could be attached initially to a large existing research university like

the California Institute of Technology or MIT, share faculty and
funding, and eventually be built separately to be on par with the other
service academies.

U.S. CYBER COMMAND

USCYBERCOM was established in 2010 by the Department of Defense to unify

the direction of cyberspace operations, strengthen DOD cyberspace capabilities,

and integrate and enhance U.S. cyber expertise. Cyber capabilities and threats are

evolving rapidly. Accordingly, a conservative Administration should be especially

sensitive to and prepared to meet the challenges presented by bureaucratic silos,

inappropriately rigid tactical doctrine, and strategic thinking’s historic tendency

to lag behind technological capability.

The preliminary evidence from the war in Ukraine suggests that existing cyber

doctrine and certain capability and target assumptions may be incorrect or mis-

placed. The following recommendations therefore presuppose that there will be

a rigorous “lessons learned” analysis and review of existing U.S. doctrine in light
of the battlefield evidence.

Needed Reforms

Ensure that USCYBERCOM is properly focused. Mission creep

is leading to wasteful overlap with the Department of Homeland
Security, National Security Agency, Department of Defense, and Central
Intelligence Agency.

Separate USCYBERCOM from the National Security Agency per
congressional direction.

Conduct effective offensive cyber-effects operations at the tactical and
strategic levels.

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Mandate for Leadership: The Conservative Promise

Expand defensive cyber-effects operations authorized by President
Trump’s classified National Security Presidential Memorandum 13,
“United States Cyber Operations Policy.”*°
End USCYBERCOM'’s participation in federal efforts to “fortify”
USS. elections to eliminate the perception that DOD is engaging in
partisan politics.

e Increase USCYBERCOWM’s effectiveness.

Accelerate the integration of cyber and electronic warfare (EW)
doctrine and capabilities, abiding by the time-tested norms of
combined-arms warfare.

Mandate that development teams will include both coders and soldiers,
aircrew, and sailors with kinetic experience at the platoon level.

Break the paradigm of cyber authorities held at the strategic level.

Increase cyber resilience by, for example, protecting the Nuclear
Command, Control, and Communications Network and the Air Force’s
Cyber Resiliency Office for Weapons Systems (CROWS).

Expand coordination of joint operations with allies.

Implement the Government Accountability Office’s recommendation
that the DOD Chief Information Officer, Commander of USCYBERCOM,
and Commander of Joint Force Headquarters-DOD Information
Network “align policy and system requirements to enable DOD to have
enterprise-wide visibility of cyber incident reporting to support tactical,
strategic, and military strategies for response.”*”

e Rationalize strategy and doctrine.

Update the October 2022 National Security Strategy to define DOD
roles and responsibilities beyond existing platitudes.

Apply traditional deterrence strategies and principles for using cyber/

EW in retaliation for foreign cyberattacks and/or EW actions against
US. infrastructure and citizens.

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2025 Presidential Transition Project

SPECIAL OPERATIONS FORCES

Even though America’s conventional war in Afghanistan was a failure, Special
Operations Forces of the United States Special Operation Command (USSOCOM)
executed an extremely effective counterterrorism campaign: There has not been
another major attack on the homeland, global terrorist threats are reduced and
managed, collaboration with international partners is effective, and units under
USSOCOM are the most capable and experienced warfighters in two generations.

There is a movement to reduce the scope and scale of USSOCOM’s mission in
favor of other service priorities in great-power competition. This would be a mis-
take because USSOCOM can be employed effectively in great-power competition.

It makes sense to capitalize on USSOCOM’s experience and repurpose its mis-
sion to include irregular warfare within the context of great-power competition,
thereby providing a robust organization that is capable of achieving strategic
effects that are critical both to our national defense and to the defense of our
allies and partners around the globe. Irregular warfare should be used proactively
to prevent state and nonstate actors from negatively affecting U.S. policies and
objectives while simultaneously strengthening our regional partnerships. If we
maintain irregular warfare’s traditional focus on nonstate actors, we limit ourselves
to addressing only the symptoms (nonstate actors), not the problems themselves
(China, Russia, North Korea, and Iran).

Needed Reforms

e Make irregular warfare a cornerstone of security strategy. The US.
can project strength through unified action with our Interagency,* allies,
and partners by utilizing irregular warfare capabilities synchronized
with elements of national power. Broadly redefining irregular warfare to
address current state and nonstate actors is critical to countering irregular
threats that range from the Chinese use of economic warfare to Russian
disinformation and Islamist terrorism. A broad definition of irregular
warfare in the National Security Strategy would allow for a whole-of-
government approach, thereby providing resources and capabilities to
counter threats and ultimately serve as credible deterrence at the strategic
and tactical levels.

1. Define irregular warfare as “a means by which the United States uses all
elements of national power to project influence abroad to counter state
adversaries, defeat hostile nonstate actors, deter wider conflict, and
maintain peace in great-power competition.”

2. Characterize the state and nonstate irregular threats facing the U.S. by
region in the National Security Strategy.

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Mandate for Leadership: The Conservative Promise

3. Direct that irregular warfare resources, capabilities, and strategies be
incorporated directly into the overall National Defense Strategy instead
of being relegated to a supporting document.

4. Establish an Irregular Warfare Center of Excellence to help DOD train,
equip, and organize to conduct irregular warfare as a core competency
across the spectrum of competition, crisis, and conflict.

Counter China’s Belt and Road Initiative (BRI) globally. DOD, in
conjunction with the Interagency, allies, and partner nations, must work
proactively to counter China’s BRI around the globe.

1. Task USSOCOM and corresponding organizations in the Pentagon
with conceptualizing, resourcing, and executing regionally based
operations to counter the BRI with a focus on nations that are key
to our energy policy, international supply chains, and our defense
industrial base.

2. Use regional and global information operations to highlight Chinese
violations of Exclusive Economic Zones, violations of human rights, and
coercion along Chinese fault lines in Xinjiang Province, Hong Kong, and
Taiwan in addition to China’s weaponization of sovereign debt.

3. Directly counter Chinese economic power with all elements of national
power in North America, Central America, and the Caribbean to
maintain maritime freedom of movement and protect the digital
infrastructure of nations in the region.

Establish credible deterrence through irregular warfare to protect
the homeland. A whole-of-government approach and willingness to
employ cyber, information, economic, and counterterrorist irregular
warfare capabilities should be utilized to protect the homeland.

1. Include the designation of USSOCOM as lead for the execution of
irregular warfare against hostile state and nonstate actors in the
National Defense Strategy.

2. Demonstrate a willingness to employ offensive cyber capabilities against

adversaries who conduct cyberattacks against U.S. infrastructure,
businesses, personnel, and governments.

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2025 Presidential Transition Project

3. Employa “name and shame” approach by making information regarding
the names of entities that target democratic processes and international
norms available in a transparent manner.

4. Work with the Interagency to employ economic warfare, lawfare, and
diplomatic pressure against hostile state and nonstate actors.

5. Maintain the authorities necessary for an aggressive counterterrorism
posture against threats to the homeland.

NUCLEAR DETERRENCE

Nuclear deterrence is one of the most critical elements of U.S. national security,
as it forms a backstop to U.S. military forces. Every operational plan relies on the
assumption that nuclear deterrence holds. Ever since the U.S. first acquired nuclear
weapons, Administrations of both parties have pursued a strategy designed to deter
nuclear and non-nuclear attack; assure allies; and, in the event of nuclear employ-
ment, restore deterrence at the lowest possible cost to the U.S. Today, however,
America’s ability to meet these goals is increasingly challenged by the growing
nuclear threats posed by our adversaries.

e China is pursuing a strategic breakout of its nuclear forces, significantly
shifting the nuclear balance and forcing the U.S. to learn how to deter two
nuclear peer competitors (China and Russia) simultaneously for the first
time in its history.

e Russia is expanding its nuclear arsenal and using the threat of nuclear
employment as a coercive tactic in its war on Ukraine.

e North Korea is advancing its nuclear capabilities.
e Iran is inching closer to nuclear capability.

Meanwhile, all U.S. nuclear capabilities and the infrastructure on which they
rely date from the Cold War and are in dire need of replacement. The next Admin-
istration will need to focus on continuing the effort to modernize the nuclear triad
while updating our strategy and capabilities to meet the challenges presented by
amore threatening nuclear environment.

Needed Reforms

e Prioritize nuclear modernization. All components of the nuclear triad are
far beyond their intended lifetimes and will need to be replaced over the next

— 123 —

Mandate for Leadership: The Conservative Promise

decade. This effort is required for the U.S. to maintain its nuclear triad—and
will be the bare minimum needed to maintain U.S. strategic nuclear deterrence.

1. Accelerate the timelines of critical modernization programs including the
Sentinel missile, Long Range Standoff Weapon (LRSO), Columbia-class
ballistic missile submarine, B-21 bomber, and F-35 Dual Capable Aircraft.

2. Reject any congressional proposals that would further extend the
service lives of U.S. capabilities such as the Minuteman III ICBM.

3. Ensure sufficient funding for warhead life extension programs (LEP),
including the B61-12, W80-4, W87-1 Mod, and W88 Alt 370.

Develop the Sea-Launched Cruise Missile-Nuclear (SLCM-N). In 2018,
the Trump Administration proposed restoring the SLCM-N to help filla
growing gap in U.S. nonstrategic capabilities and improve deterrence against
limited nuclear attack.*? The Biden Administration canceled this program
in its 2022 Nuclear Posture Review (NPR).*° The next President should
support and accelerate funding for development of the SLCM-N with the
goal of deployment by the end of the decade.

Account for China’s nuclear expansion. To ensure its ability to deter
both Russia and the growing Chinese nuclear threat, the U.S. will need more
than the bare minimum of nuclear modernization. President Biden’s 2022
NPR described the problem but proposed no recommendations to restore or
maintain nuclear deterrence.

1. Consider procuring more modernized nuclear systems (such as the
Sentinel missile or LRSO) than currently planned.

2. Improve the ability of the US. to utilize the triad’s upload capacity in
case of a crisis.

3. Review what capabilities in addition to the SLCM-N (for example,
nonstrategic weapons or new warhead designs) are needed to deter the
unique Chinese threat.

Restore the nuclear infrastructure. The United States must restore

its necessary nuclear infrastructure so that it is capable of producing and
maintaining nuclear weapons.

— 124 —

2025 Presidential Transition Project

1. Accelerate the effort to restore plutonium pit production, which is essential
both for modern warhead programs and for recapitalizing the stockpile.

2. Continue to invest in rebuilding infrastructure, including facilities at
the National Laboratories that support nuclear weapons development.

3. Restore readiness to test nuclear weapons at the Nevada National
Security Site to ensure the ability of the U.S. to respond quickly to
asymmetric technology surprises.

e Correctly orient arms control. The U.S. should agree to arms control
agreements only if they help to advance the interests of the U.S. and its allies.

1. Reject proposals for nuclear disarmament that are contrary to the goal
of bolstering deterrence.

2. Pursue arms control as a way to secure the national security interests of
the U.S. and its allies rather than as an end in itself.

3. Prepare to compete in order to secure U.S. interests should arms control
efforts continue to fail.

MISSILE DEFENSE

Missile defense is a critical component of the U.S. national security architecture.
It can help to deter attack by instilling doubt that an attack will work as intended,
take adversary “cheap shots” off the table, and limit the perceived value of mis-
siles as tools of coercion. It also allows space for diplomacy during a crisis and can
protect U.S. and allied forces, critical assets, and populations if deterrence fails."
Adversaries are relying increasingly on missiles to achieve their aims.

e China and Russia, in addition to their vast and growing ballistic missile
inventories, are deploying new hypersonic glide vehicles and investing in
new ground-launched, air-launched, and sea-launched cruise missiles that
uniquely challenge the United States in different domains.

e North Korea has pursued an aggressive missile testing program and is
becoming increasingly belligerent toward South Korea and Japan.

e Iran continues to maintain a missile arsenal that is capable of striking U.S.

and allied assets in the Middle East and Europe, and its rocket launches
demonstrate that it either has or is developing the ability to build ICBMs.

— 125 —

Mandate for Leadership: The Conservative Promise

Missile defense has been underprioritized and underfunded in recent years. In

light of these growing threats, the incoming Administration should treat missile

defense as a top priority.

Needed Reforms

Champion the benefits of missile defense. Despite its deterrence and
damage-limitation benefits, opponents argue incorrectly that U.S. missile
defense is destabilizing because it threatens Russian and Chinese second-
strike capabilities.

1. Reject claims made by the Left that missile defense is destabilizing
while acknowledging that Russia and China are developing their own
advanced missile defense systems.

2. Commit to keeping homeland missile defense off the table in any arms
control negotiations with Russia and China.”

Strengthen homeland ballistic missile defense. The United States
currently deploys 44 Ground-Based Interceptors (GBIs) as part of its
Ground-based Midcourse Defense (GMD) system to defend the homeland
against North Korea, but as North Korea improves its missile program, this
system is at risk of falling behind the threat."

1. Buy atleast 64 of the Next Generation Interceptor (NGD), which is more
advanced than the GBI, for an eventual uniform fleet of interceptors.**
The Biden Administration currently plans to buy only 20.

2. Consider additional steps to strengthen the GMD system such as a
layered missile defense or a third interceptor site on the East Coast.

Increase the development of regional missile defense. As the Ukraine
conflict amply demonstrates, U.S. regional missile defense capabilities are
very limited. The United States has been unable to supply our partners
reliably with any capabilities, and the number and types of regional missile
defense platforms are less than the U.S. needs for its own defense. The U.S.
should prioritize procurement of more regional defense systems such as
Theater High Altitude Area Defense (THAAD), Standard Missile-3, and
Patriot missiles.

Change U.S. missile defense policy. Historically, the U.S. has chosen
to rely solely on deterrence to address the Russian and Chinese ballistic

— 126 —

2025 Presidential Transition Project

missile threat to the homeland and to use homeland missile defense only

against rogue nations.

Abandon the existing policy of not defending the homeland against
Russian and Chinese ballistic missiles and focus on how to improve
defense as the Russian and Chinese missile threats increase at an
unprecedented rate.*®

Invest in future advanced missile defense technologies like directed
energy or space-based missile defense that could defend against more
numerous missile threats.

Invest in new track-and-intercept capabilities. The advent of
hypersonic missiles and increased numbers of cruise missile arsenals by

threat actors poses new challenges to our missile defense capabilities.

Invest in cruise missile defense of the homeland.*®

Accelerate the program to deploy space-based sensors that can detect
and track missiles flying on nonballistic trajectories.”

Accelerate the Glide Phase Interceptor, which is intended to counter
hypersonic weapons.

AUTHOR'S NOTE: The mission of the Department of Defense is to provide the military forces needed to deter
war and ensure our nation’s security. This chapter provides a blueprint to ensure that the Department can meet our
national security needs. Its preparation was a collective enterprise of individuals involved in the 2025 Presidential
Transition Project. All contributors to this chapter are listed at the front of this volume, but Sergio de la Pena and
Chuck DeVore deserve special mention. The author alone assumes responsibility for the content of this chapter, and
no views expressed herein should be attributed to any other individual.

— 127 —

Mandate for Leadership: The Conservative Promise

ENDNOTES

18.
19.

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U.S. Constitution, Ar
February 16, 2023).
S. Constitution, Ar
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stablished pursuan
7th Cong
PLAW-117pub
H.R. 3684, Inf
Division G, Tit
(accessed February
S. 2943, National De

icle Il, § 2, https://constitu

81.pdf
astruc

6, 2023).

ense Authorization Act for Fiscal Year 2017,

.congress.gov/constitution/preamble/ (accessed
icle |, § 8, https://constitution.congress.gov/constitution/article-1/ (accessed
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to S. 1605, National Defense Authorization Act for Fiscal Year 2022, Public Law No. 117-81,
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ure Investment and Jobs Act, Public Law No. 117-58, 117th Congress,
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ps://www.congress.gov/117/plaws/publ81
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17/plaws/publ58/PLAW-117publ58.pdf

Public Law 114-328, 114th Congress, December

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lita

(accessed February 15, 2023).
See Thomas W. Spoehr, “The Admini
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bid.

Ronald Reagan

ion

nstitute, “Reagan

See Paul J. Larkin, “Protecting the

military-spouses.
See Jude Schwa

lexible-education-options.
See Chapter 7, “T
The Defense Intelligence Agency (D
ntelligence Agency (NGA); the National Reconn
counterintelligence elements of the m
Army Intelligence, and U.S. Marine Corps
Under Secretary of Defense for Inte
The Office of the Director of Nati
The Department of Energy’s Offi
Security's Office of
U.S. Coast Guard; the Departmen
Administration's Office of National Securi
Research; and the Departmen

A);

onal Inte
ce of

of the Treasury's

It/files/dsca

H.R. 3622, Goldwater-Nichols Department of Defense Reorganization Act of 1986, Public Law No. 99-433,
99th Congress, October 1, 1986, https://www.congress.gov/99/statute/STATUTE-100/STATUTE-100-Pg992.pdf

y Cooperation Agency, Historical Sales Book, Fiscal Years

historical sales_ book_FY21.pdf (accessed

reaganfoundation.org/media/358085/rndf_survey_book
ation by Employing

he Intelligence Community,” infra.
the National Secu

itary services: U.S. Air
ntelligence, which a
ligence (USDI).

ligence (OD
Intelligence and Coun
Intelligence and Analysis and the intelligen

aissance O

|) and

Process,’ Congressional Research Service Report for Members
ed June 10, 2022, p. 1, https://sgp.fas.org/crs/weapons/

y Sales Process,” The Hill Congress Blog, October 6, 2022,
https://thehill.com/opinion/congress-blog/3675933-how-to-reform-americas-military-sales-process/

stration and Congress Must Act Now to Counter the Worsening Military
Issue Brief No. 5283, July 28, 2022, https://www.heritage.org/sites/

ational Defense Survey,” conducted November 2021, p. 4, https://www.
et.odf (accessed February 16, 2023).

ilitary Spouses,” Heritage Foundation Commentary,
June 6, 2019, https://www.heritage.org/jobs-and-labor/commentary/protecting-the-nation-employing-

bach, “Military Families Deserve Flexible Education Options,” Heritage Foundation

Commentary, April 14, 2021, https://www.heritage.org/education/commentary/military-families-deserve-

y Agency (NSA); the National Geospatial-

fice (NRO); and the intelligence and

Force Intelligence, U.S. Navy Intelligence, U.S.
so receive guidance and oversight from the

he Central Intelligence Agency (CIA).

terintelligence; the Department of Homeland

ce and counterintelligence elements of the

of Justice’s Federal Bureau of Investigation and the Drug Enforcement
y Intelligence; the Department of State’s Bureau of Intelligence and

Office of Intel

128 —

igence and Analysis.

20.

21.

22.

25.

24.

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27.

28.

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2025 Presidential Transition Project

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(accessed February 15, 2023).

Ronald O’Ro

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rke, “Great Power Compe
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/odf/R/R43838/93 (accessed February 15, 2023).

U.S. Government Accountabil
Expectations and to Develop
assets/gao-21-295.pdf (accessed February 15, 2023).

The US. mili
disasters bu
authorities (D
DoD Compon
Governors 0

other domest

2010, p. 16, ht
of%20Civil%2

February 17, 2

“(T]he Army’s internal assessmen

Department of De

oro
SCA
ent asse
he affec

(o requests for assista
ic activiti
ense, Directive No. 3025.18, “
ps://www.dco.uscg.mil/Portals/9/CG-5
ities.odf (accessed February 15,
U.S. Army, “Who We Are: The Army’s Vision and Stra

OAuthor

023).

ary has a long hi
her purposes as we
as “Support provided by U.S

s, and

nce fro
es, or f

on company-level operations

operations
competitor

ed. Dakota
com/2022/|

avy,” Heri
iles/2021
and Issues

Februa
The Joi
deve
Acqui

[much less division
such as Russia or Chin
in combat operations is an open question.” “Execu
L. Wood (Washing
ilitary_Index/2023_|
For background on the USN’s
age Founda
02/SR242.pd
or Congress,
0. RL32665, Decembe
y 15, 2023).

nt Capabilities In
op and the Joint S
ion University, “J
edu/acquipedia/pages/arti

and

21,2

The board would seek to bala

form

ajor acquisitions and
proposed composition wo
membership from the Join
Command. In addition, the
each named by the Chairm
Navy, and the Secretary of Defense. Fi
who had previous senior experience
See James Mattis, Secretary of Defen

uld
S
re

egration an
approves
oint Capabi
cledetails.aspx#!

ormer mili

en of the

ity Office,

|. The De

m civil authorities
rom qualifying ent

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or corps to meet

on: The Heritage

lee

Ronald O'Rourke,
022, https://crsrep
d Deve
lities In

nce a mix of act

include the V
taff, the Navy an
would be four-s

ouse and
nally, th
in the de

t must be balanced
ective of counterin

a]. Consequently, h

ndexOfUSMilitaryS
size, see Brent D. Sadler, “Rebu
ion Special Report No. 242, February 18, 2021, https://www.heritage.org/sites/default/

he requirem

ve mili

ere WO

story of providing support to civil authorities, pa

ense Department
. Federal military ft

ational Guard forces (when the Secretary of De
ted States, elects and req

uests to use those

R/nsarc/DoD
2023).

elligence req
la

tive Summary”

Foun

“

avy Force Struc

or domestic emergencies, law
ities for special events. Also kn
Defense Support of Civil Authori

egy,” https://www.army.mi

against its own statements

dation, 2023), p. 16, http://thf_m
rength.pdf (accessed February 1

ition: Implications for Defense—Issues for Congress,” Congressional

ovember 8, 2022,

Defense Intelligence and Security: DOD Needs to Establish Oversight
Tools That Enhance Accountability, GAO-21-295,

ay 2021, https://www.gao.gov/

ticularly in response to
currently defines defense support of civil
orces, DoD civilians, DoD contract personnel,
ense, in coordination with the

e 32, U.S.C, status) in response
enforcement support, and

own as civil support.” U.S.

ies (DSCA),” December 29,
D%203025.18%20Defense%20Support%20

forces in Tit

/about/ (accessed

that unit training is focused
her than battalion or brigade

uirements] rat

ge-scale ground combat operations against a peer
ow these ‘ready’ brigade comba

teams would perform
in 2023 Index of U.S. Military Strength,
edia.s3.amazonaws.

5, 2023).

ilding America’s Military: The United States

ure and Shipbuilding Plans: Background

” Congressional Research Service Report for Members and Committees of Congress
s.congress.gov/product/pdf/RL/RL32665 (accessed

opment System (JCIDS) is the process by which the services
ts for major defense acquisi
egration and Development System (J
37] (accessed February 15, 2023).

i ary and civilians with exper’
ary and civilians with experience in strategy and acquisitions. The
ice Chief of Naval Operations as Chair
d Defense Acquisition Executives, and the Naval Sea Systems
ar retired naval officers/Navy civil servants as members, one

ions. See Defense
CIDA),” https://www.dau.

ise in and responsibility

man, with three-star level

Senate Armed Services Committees, the Secretary of the

uld be a member appointed by the Secretary of the Navy
ense industry.
se, Summary of the 2018 National Defense Strategy of the United States

of America; Sharpening the American Military’s Competitive Edge, U.S. Department of Defense, https://

dod.defense.gov/Portals/1/Documen
February 17, 2023), and U.S. Departm

s/pubs/2018-National-Defense-Strategy-Summary.pdf (accessed
ent of Defense, 2022 National Defense Strategy of the United States of

America Including the 2022 Nuclear Posture Review and the 2022 Missile Defense Review, https://oldcc.gov/

resource/2022-national-defense-stra

— 129 —

egy (accessed February 17, 2023).

30.

31.

32.

55;

34,

35.

36.

37.

38.

59:

40.

Al.

42.

43.

44.

Mandate for Leadership: The Conservative Promise

U.S. Air Force, “The Air Force We Need: 386 Operational Squadrons,” September 17, 2018, https://Awww.
af.mil/News/Article-Display/Article/1635070/the-air-force-we-need-386-operational-squadrons/ (accessed
February 17, 2023).
General David H. Berger, Commandant of the Marine Corps, “Force Design 2030,” U.S. Department of the
avy, U.S. Marine Corps, March 2020, https://www.hamc.marines.mil/Portals/142/Docs/CMC38%20Force%20
Design%202030%20Report%20Phase%201%20and%20II.pdf2ver=2020-03-26-121328-460 (accessed
February 17, 2023).
Department of the Navy, United States Marine Corps, “Force Design 2030,” March 2020, https://www.hamc.
marines.mil/Portals/142/Docs/CMC38%20Force%20Design%202030%20Report%20Phase%201%20and%20II.
pdf?ver=2020-03-26-121528-460 (accessed February 15, 2023).
Philip Athey, “Here Are Some of the Ways the Marines Are Trying to Improve Retention,” Marine Corps Times,
ovember 15, 2021, https://www.marinecorpstimes.com/news/your-marine-corps/2021/11/15/treat-people-
like-human-beings-here-are-some-of-the-ways-the-marines-are-trying-to-improve-retention/ (accessed
ebruary 15, 2023).
egan Eckstein, “Marines, Navy Near Agreement on Light Amphibious Warship Features,” Defense News,
October 5, 2022, https://www.defensenews.com/naval/2022/10/05/marines-navy-near-agreement-on-light-
amphibious-warship-features/ (accessed February 16, 2023).
egan Eckstein, “Marines Explain Vision for Fewer Traditional Amphibious Warships,” Defense News, June
21, 2021, https://www.defensenews.com/naval/2021/06/21/marines-explain-vision-for-fewer-traditional-
amphibious-warships-supplemented-by-new-light-amphib/ (accessed February 16, 2023).
See Sidney J. Freedberg Jr., “Trump Eases Cyber Ops, but Safeguards Remain: Joint Staff,’ Breaking Defense,
September 17, 2018, https://breakingdefense.com/2018/09/trump-eases-cyber-ops-but-safeguards-remain-
joint-staff/ (accessed March 7, 2023); Dustin Volz, “White House Confirms It Has Relaxed Rules on U.S. Use
of Cyberweapons,” The Wall Street Journal, September 20, 2018, https://www.wsj.com/articles/white-house-
confirms-it-has-relaxed-rules-on-u-s-use-of-cyber-weapons-1537476729 (accessed March 7, 2023); and
Federation of American Scientists, Intelligence Resource Program, “National Security Presidential Memoranda
[NSPMs]: Donald J. Trump Administration,” updated March 7, 2022, https://irp.fas.org/offdocs/nspm/index.
html (accessed March 7, 2023).
U.S. Government Accountability Office, DOD Cybersecurity: Enhanced Attention Needed to Ensure Cyber
Incidents Are Appropriately Reported and Shared, GAO-23-105084, November 2022, p. 36, https://www.gao.
gov/assets/gao-23-105084.pdf (accessed February 17, 2023).
See Paul Evancoe, “Special Operations and the Interagency Team,” U.S.Military.com, https://usmilitary.
com/special-operations-and-the-interagency-team/#:~:text=Seldom%20considered%20are%20those%20
other%20government%20agency%20%280GA%29, response%20and%20consequence%20management%20
0%20name%20a%20few (accessed February 17, 2023).
U.S. Department of Defense, Nuclear Posture Review, February 2018, pp. 54-55, https://media.defense.
gov/2018/Feb/02/2001872886/-1/-1/1/2018-NUCLEAR-POSTURE-REVIEW-FINAL-REPORT.PDF (accessed
February 17, 2023).
U.S. Department of Defense, 202? National Defense Strategy of the United States of America Including the
202? Nuclear Posture Review and the 2022 Missile Defense Review, pp. 3 and 20.
Patty-Jane Geller, “Missile Defense,” in 2023 Index of U.S. Military Strength, ed. Dakota L. Wood (Washington:
The Heritage Foundation, 2023), pp. 507-508, http://thf_media.s3.amazonaws.com/2022/Military__
ndex/2023_IndexOfUSMilitaryStrength.pdf.
atthew R. Costlow, “The Folly of Limiting U.S. Missile Defenses for Nuclear Arms Control,” National
nstitute for Public Policy Information Series, lssue No. 505, October 18, 2021, https://nipp.org/wp-content/
uploads/2021/10/IS-505.pdf (accessed February 16, 2023).
Forum for American Leadership, “Don’t Hand North Korea a Win in the Missile Defense Review,” January 4,
2022, https://forumforamericanleadership.org/dprk-missile-threat (accessed February 16, 2023).
Patty-Jane Geller, “It’s Time to Get Homeland Missile Defense Right,” Defense News, January 4, 2021, https://
www.defensenews.com/opinion/commentary/2021/01/04/its-time-to-get-homeland-missile-defense-
right/#:-:text=Restoring%200ur%20eroding%20edge%20when,advanced%20technology%20and%20
new%20capabilities.%E2%80%9D (accessed February 16, 2023).

— 130 —

2025 Presidential Transition Project

45. Forum for American Leadership, “How Biden's Missile Defense Review Can Succeed,” October 21, 2021, https://

orumforamericanleadership.org/missile-defense-review (accessed February 16, 2023).

46. Tom Karako, Matt Strohmeyer, lan Williams, Wes Rumbaugh, and Ken Harmon, North America Is a Region,

Too: An Integrated, Phased, and Affordable Approach to Air and Missile Defense for the Homeland, Center

or Strategic and International Studies, Missile Defense Project, July 2022, https://csis-website-prod.

s3.amazonaws.com/s3fs-public/publication/220714_Karako_North_America.pdf?Versionld=BhiKa8jHHF _

kV94NXRMx6D4m206LQqUF (accessed February 16, 2023).

47. Rebeccah Heinrichs, “Why America Needs the Ability to Track Enemy Missiles from Space,” The Hill, April 16,
2019, https://thehill.com/opinion/national-security/438939-why-america-needs-the-ability-to-track-enemy-
missiles-from-space/ (accessed February 16, 2023).

— 131 —

DEPARTMENT OF
HOMELAND SECURITY

Ken Cuccinelli

PRIMARY RECOMMENDATION

Our primary recommendation is that the President pursue legislation to dis-
mantle the Department of Homeland Security (DHS). After 20 years, it has not
gelled into “One DHS.” Instead, its various components’ different missions have
outweighed its decades-long attempt to function as one department, rendering
the whole disjointed rather than cohesive. Breaking up the department along its
mission lines would facilitate mission focus and provide opportunities to reduce
overhead and achieve more limited government. In lieu of a status quo DHS, we
recommend that:

e U.S. Customs and Border Protection (CBP) be combined with
Immigration and Customs Enforcement (ICE); U.S. Citizenship
and Immigration Services (USCIS); the Department of Health and
Human Services (HHS) Office of Refugee Resettlement (ORR); and
the Department of Justice (DOJ) Executive Office for Immigration
Review (EOIR) and Office of Immigration Litigation (OIL) into a stand-
alone border and immigration agency at the Cabinet level (more than
100,000 employees, making it the third largest department measured
by manpower).

e The Cybersecurity and Infrastructure Security Agency (CISA) be moved to
the Department of Transportation.

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Mandate for Leadership: The Conservative Promise

e The Federal Emergency Management Agency (FEMA) be moved to the
Department of the Interior or, if combined with CISA, to the Department of
Transportation.

e The U.S. Coast Guard (USCG) be moved to DOJ and, in time of full-scale
war (i.e., threatening the homeland), to the Department of Defense (DOD).
Alternatively, USCG should be moved to DOD for all purposes.

e The US. Secret Service (USSS) be divided in two, with the protective
element moved to DOJ and the financial enforcement element moved to the
Department of the Treasury.

e The Transportation Security Administration (TSA) be privatized.

e The Science and Technology Directorate (S&T) be moved to DOD and the
Office of Countering Weapons of Mass Destruction be moved to the FBI.

All of the remaining supporting components could be dismantled because
their functions already exist in the moving components as well as the receiv-
ing departments. Cutting these costs would save the American taxpayers
significant sums.

Unless and until this dismantling recommendation is pursued and achieved,
however, DHS will statutorily continue to exist, and it needs many reforms. Accord-
ingly, we now turn to recommended changes in DHS as it exists now.

MISSION STATEMENT

The Department of Homeland Security protects the American homeland from
and prepares for terrorism and other hazards in both the physical and cyber realms,
provides for secure and free movement of trade and travel, and enforces U.S. immi-
gration laws impartially.

OVERVIEW

The Department of Homeland Security (DHS) was created in the aftermath of
the terrorist attacks of September 11, 2001, and subsequent mailings of anthrax
spores. The Homeland Security Act of 2002,' which created the department, states
that DHS’s primary mission is to prevent terrorist attacks within the U.S.; reduce
the nation’s vulnerability to terrorism; minimize the damage from and assist in the
recovery from any terrorist attacks; prepare and respond to natural and manmade
crises and emergencies; and monitor connections between illegal drug trafficking
and terrorism, coordinate efforts to sever such connections, and interdict illegal
drug trafficking.

— 134 -—

2025 Presidential Transition Project

Unfortunately for our nation, the federal government’s newest department
became like every other federal agency: bloated, bureaucratic, and expensive. It also
lost sight ofits mission priorities. DHS has also suffered from the Left’s wokeness and
weaponization against Americans whom the Left perceives as its political opponents.

To truly secure the homeland, a conservative Administration needs to return
the department to the right mission, the right size, and the right budget. This would
include reorganizing the department and shifting significant resources away from
several supporting components to the essential operational components. Prior-
itizing border security and immigration enforcement, including detention and
deportation, is critical if we are to regain control of the border, repair the historic
damage done by the Biden Administration, return to a lawful and orderly immi-
gration system, and protect the homeland from terrorism and public safety threats.
This also includes consolidating the pieces of the fragmented immigration system
into one agency to fulfill the mission more efficiently.

The Cybersecurity and Infrastructure Security Agency (CISA) is a DHS com-
ponent that the Left has weaponized to censor speech and affect elections at the
expense of securing the cyber domain and critical infrastructure, which are threat-
ened daily.” A conservative Administration should return CISA to its statutory and
important but narrow mission.

The bloated DHS bureaucracy and budget, along with the wrong priorities,
provide real opportunities for a conservative Administration to cut billions in
spending and limit government’s role in Americans’ lives. These opportunities
include privatizing TSA screening and the Federal Emergency Management
Agency (FEMA) National Flood Insurance Program, reforming FEMA emergency
spending to shift the majority of preparedness and response costs to states and
localities instead of the federal government, eliminating most of DHS’s grant pro-
grams, and removing all unions in the department for national security purposes.
Asuccessful DHS would:

e Secure and control the border;
e Thoroughly enforce immigration laws;

e Correctly and efficiently adjudicate immigration benefit applications while
rejecting fraudulent claims;

e Secure the cyber domain and collaborate with critical infrastructure sectors
to maintain their security;

e Provide states and localities with a limited federal emergency response and
preparedness;

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Mandate for Leadership: The Conservative Promise

e Secure our coasts and economic zones;

e Protect political leaders, their families, and visiting heads of state or
government; and

e Oversee transportation security.

OFFICE OF THE SECRETARY (SEC)

In the next Administration, the Office of the Secretary should take on the fol-
lowing key issues and challenges to ensure the effective operation of DHS.

Expansion of Dedicated Political Personnel. The Secretary of Homeland
Security is a presidentially appointed and Senate-confirmed political appointee,
but for budgetary reasons, he or she has historically been unable to fund a dedi-
cated team of political appointees. A key first step for the Secretary to improve
front-office functions is to have his or her own dedicated team of political appoin-
tees selected and vetted by the Office of Presidential Personnel, which is not reliant
on detailees from other parts of the department, to help ensure the completion of
the next President’s agenda.

An Aggressive Approach to Senate-Confirmed Leadership Positions.
While Senate confirmation is a constitutionally necessary requirement for
appointing agency leadership, the next Administration may need to take a novel
approach to the confirmations process to ensure an adequate and rapid transition.
For example, the next Administration arguably should place its nominees for key
positions into similar positions as “actings” (for example, putting in a person to
serve as the Senior Official Performing the Duties of the Commissioner of CBP
while that person is going through the confirmation process to direct ICE or
become the Secretary). This approach would both guarantee implementation of
the Day One agenda and equip the department for potential emergency situations
while still honoring the confirmation requirement. The department should also
look to remove lower-level but nevertheless important positions that currently
require Senate confirmation from the confirmation requirement, although this
effort would require legislation (and might also be mooted in the event of legisla-
tion that closes portions of the department that currently have Senate-confirmed
leadership).

Clearer, More Durable, and Political-Only Line of Succession. Based on
previous experience, the department needs legislation to establish a more durable
but politically oriented line of succession for agency decision-making purposes.
The ideal sequence for line of succession is certainly debatable, except that in cir-
cumstances where a career employee holds a leadership position in the department,
that position should be deemed vacant for line-of-succession purposes and the next
eligible political appointee in the sequence should assume acting authority. Further,

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2025 Presidential Transition Project

individuals wielding acting Secretary authority should have explicit authority to
finalize agency actions, including regulations, to ensure that the department’s
homeland security mission is fulfilled.

Soft Closure of Unnecessary Offices. Pending a possible presidential deci-
sion to shrink or eliminate DHS itself, the next Administration will still have the
obligation to protect the homeland as required by law. The Secretary therefore
can and should use his or her inherent, discretionary leadership authority to “soft
close” ineffective and problematic corners of the department. While those corners
are to be determined, the Secretary could shift personnel, funding, and opera-
tional responsibility to mission-essential components of the department, including
the Office of the Secretary itself. This effort not only would make the department
more efficient, but also would support a legislative move to shrink or dismantle
the department by showing that the agency can fulfill national security-critical
functions without its current bloated bureaucracy.

Restructuring and Redistribution of Career Personnel. To strengthen
political decision-making and ensure that taxpayer dollars are being used legally
and efficiently, the Secretary should make major changes in the distribution of
career personnel throughout the department. For example, personnel from parts
of the department undergoing soft closure could be redistributed to what will be
workload-intensive corners of the department, including national security-critical
and transparency functions. All personnel with law enforcement capacity should
be removed immediately from office billets and deployed to field billets to maxi-
mize law enforcement capacity.

Compliance for Grants and Other Federal Funding. The next Adminis-
tration should take steps to restore lawfulness and integrity to the department’s
massive regimen of federal grant programs, most of which are managed and dis-
tributed by the Federal Emergency Management Agency. The Secretary should
direct FEMA to ensure that all FEMA-issued grant funding for states, localities,
and private organizations is going to recipients who are lawful actors, can demon-
strate that they are in compliance with federal law, and can show that their mission
and actions support the broader homeland security mission. All applicants and
potential recipients of such grant funding should be required to meet certain pre-
conditions for eligibility (except for receipt of post-disaster or nonhumanitarian
funding) or should simply be considered ineligible for funding. Such preconditions
should include at least the following:

e =6Certification by applicants that they comply with all aspects of federal
immigration laws, including the honoring of all immigration detainers.

e Certification by applicants that they are both registered with E-Verify
and using E-Verify in a transparent and nonevasive manner. For states

— 137 —

Mandate for Leadership: The Conservative Promise

and localities, that would include certification that all components of that
government, and not just the applicant agency, are registered with and
use E-Verify.

e Ifthe applicant is a state or locality, commitment by that state or locality to
total information-sharing in the context of both federal law enforcement
and immigration enforcement. This would include access to department of
motor vehicles and voter registration databases.

Non-Use of Discretionary Guest Worker Visa Authorities. To stop facili-
tating the availability of cheap foreign labor in order to support American workers
(particularly poor and middle-class American workers) and follow congressional
intent, the Secretary should explicitly cease using at least two discretionary author-
ities as part of his or her broader effort to support American workers.

e The Secretary should make it clear that he or she will not use the Secretary’s
existing discretionary authority to increase the number of H-2B (seasonal
non-agricultural) visas above the statutorily set cap.

e The Secretary should not issue any regulations in support of the “H-2
eligible” country list, the effect of which would prevent favoring certain
foreign nationals seeking an H-2 guest worker visa based simply on their
nationality.

Restoration of Honesty and Transparency. The Secretary should use his or
her inherent authority as leader of the department to follow up with congressional
and other partners to disclose information and provide the transparency that has
been obstructed during the Biden Administration. The Secretary should proceed
from the assumption that congressional inquiries and public information requests
were unfulfilled and then seek to fulfill them.

Replacement of the Entire Homeland Security Advisory Committee. The
Secretary should plan to quickly remove all current members of the Homeland
Security Advisory Committee and replace them as quickly as is feasible.

U.S. CUSTOMS AND BORDER PROTECTION (CBP)

If all immigration agencies are not merged, including USCIS and ORR, then
an appropriate third alternative would be to consolidate ICE and CBP to form
a combined Border Security and Immigration Agency (BSIA). This would inte-
grate critical interdiction, enforcement, and investigative resources, enhancing
coordination and refocusing collective efforts on the vast and complex cross-bor-
der threats impacting our nation’s health, safety, and national security. It would

— 138 —

2025 Presidential Transition Project

also simultaneously add efficiencies to our nation’s capacity to facilitate lawful
trade and travel.

The BSIA should establish clear mission requirements, responsibilities, and
mandates under existing law regarding the persistent need for and utilization of
U.S. military personnel and resources to assist BSIA with increasing whole-of-gov-
ernment efforts and long-term strategy to secure our nation’s borders effectively.
In addition, appropriate elements within the newly created BSIA should be desig-
nated as part of the U.S. National Security and Intelligence Community.

A conservative Administration should eliminate any prohibitive guidance,
direction, or mandate from DHS or the Administration that curtails or limits CBP
from publishing detailed border security and enforcement data not impacting
intelligence, interdiction, and investigative operations, methods, or sources. DHS
should issue a regulation mandating that CBP publish accurate and timely border
security data, readily available to the public, on a regular basis that avoid White
House and DHS leadership review and approval.

The White House should grant the authority for CBP and DHS executives to
utilize component aviation assets under the Office of Air and Marine (OAM). CBP
and DHS have worldwide missions with personnel and facilities that are deployed
across the globe and in every state in the U.S. With a CBP workforce alone of more
than 60,000 people (240,000-plus for DHS) encompassing more than a thousand
sea, land, and airports, it is essential that the Commissioner, Deputy Commissioner,
Secretary, and Deputy Secretary can travel efficiently to facilities to maintain
appropriate situational awareness across the department’s vast mission set and
interact with the expansive workforce. Although CBP operates one of the largest
aviation components of any domestic U.S. law enforcement agency, executives are
prohibited from utilizing the agency’s aviation assets to facilitate official travel.
Executives are required to fly on commercial airlines, and this requirement sig-
nificantly limits their ability to have classified communications and takes them
offline for extended periods of time.

Border Patrol (BP) and OAM should be combined within CBP. BP has more than
20,000 personnel, and OAM has approximately 1,800. OAM’s assets are dedicated
in support of BP operations the vast majority of the time, yet redundant approv-
als, strategies, and independent hierarchal commands serve as impediments to
efficient and practical resource deployments.

CBP should restart and expand use of the horseback-mounted Border Patrol. As
part of this announcement, the Secretary should clear the records and personnel
files of those who were falsely accused by Secretary Alejandro Mayorkas of whip-
ping migrants and issue a formal apology on behalf of DHS and CBP.

The Secretary should combine the Office of Trade (OT) and Trade Relations
with the Office of Field Operations (OFO). The OT is the smallest of CBP’s compo-
nents, and its operational counterpart, OFO, has a workforce of more than 30,000.

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Mandate for Leadership: The Conservative Promise

OT’s function is interwoven with that of its OFO operational counterpart. Combin-
ing OT with OFO would achieve streamlined operations and increase OT’s capacity
and capability by leveraging OFO’s expansive resources.

CBP, ICE, and USCIS all have authority to issue Notices to Appear (NTA) to
removable aliens in their presence, which begins removal proceedings. In most
instances, CBP should turn illegal aliens over to ICE for detention, and ICE can
then issue any needed NTA. CBP should issue NTAs only in limited situations
for humanitarian reasons, such as medical emergencies. In addition, CBP should
eliminate use of Notices to Report (NTR) altogether.

CBP’s established national standards of Transport, Escort, Detention, and
Search (TEDS) have been widely interpreted and expanded by lower courts. This
has resulted in unrealistic and differing detention standards for CBP facilities based
on the jurisdiction within which they fall, negatively impacting operations. ICE has
suffered similarly. A single nationwide detention standard should be codified that
prevents individual states from mandating that federal government agencies adhere
to widely expansive and ever-changing sets of standards. Such standards should allow
the flexibility to use large numbers of temporary facilities such as tents.

The annual costs associated with establishing and maintaining temporary facil-
ities to address the flow of illegal migration and associated care, transportation,
and processing are prohibitive, and CBP’s budget is inadequate. CBP is forced to
forgo critical mission-essential endeavors to fund the additional associated costs.
Often, this requires the reprogramming of funding at the DHS level, which has a
negative impact on other DHS components’ operations. This predictable cost that
has to be paid from existing CBP and DHS funding levels reduces CBP’s operational
readiness and ability to accomplish its diverse and critical missions to protect the
American people. The next President should request a realistic budget that fully
pays for these costs.

Increased funding is needed for BP to hire additional support personnel, which
would relieve uniformed BP agents from administrative duties associated with
processing aliens and allow them to return to their national security mission.

Congress should increase funding for facility upgrades at strategic land Ports of
Entry (POEs), including expanding state-of-the-art technology such as Non-Intru-
sive Inspection equipment. Today, the cartels exploit the aging facilities and lack
of adequate technology to smuggle illicit drugs, contraband, and more successfully
through our nation’s POEs.

U.S. IMMIGRATION AND CUSTOMS ENFORCEMENT (ICE)
Needed Reforms

Since the formation of DHS, ICE has increasingly been tasked with auxiliary
missions that have little or nothing to do with either immigration or customs

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enforcement. To return ICE to its primary mission, any new Administration that
wishes to restore the rule of law to our immigration enforcement efforts should:

e Order ICE to stop closing out pending immigration cases and apply
the Immigration and Nationality Act (INA) as written by Congress.’
The Biden Administration closed out tens of thousands of immigration
cases that had already been prepared and were slated for expedited removal
processing or hearings before the U.S. Immigration Court. This misguided
action constituted an egregious example of lawlessness that allowed
thousands of illegal aliens and other immigration violators to go free in the
United States.

e Direct ICE to stop ignoring criminal aliens identified through the
287(g) program.* Ultimately, Congress should prevent ICE from ignoring
criminal aliens identified by local law enforcement agencies that are partners
in the 287(g) program. However, before congressional action, ICE should
be directed to take custody of all aliens with records for felonies, crimes of
violence, DUIs, previous removals, and any other crime that is considered a
national security or public safety threat as defined under current laws.

e Eliminate T and U visas. Victimization should not be a basis for an
immigration benefit. If an alien who was a trafficking or crime victim is
actively and significantly cooperating with law enforcement as a witness,
the S visa is already available and should be used. Pending elimination of the
T and U visas, the Secretary should significantly restrict eligibility for each
visa to prevent fraud.

e Issue clear guidance regarding detention and bond for aliens.
Thousands of illegal aliens are allowed to bond out of immigration detention
only to disappear into the interior of the United States where many commit
crimes and many others disappear, never to be heard from again. This
occurs primarily because of poorly worded bond regulations, contradictory
bond policy memoranda, and poor practices for managing released
aliens and the Alternatives to Detention (ATD) Program, which requires
significant reform.

e Prioritize national security in the Student and Exchange Visitor
Program (SEVP). ICE should end its current cozy deference to educational
institutions and remove security risks from the program. This requires
working with the Department of State to eliminate or significantly reduce
the number of visas issued to foreign students from enemy nations.

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Most of the foregoing can be accomplished rapidly and effectively through exec-
utive action that is both lawful and appropriate. Additionally, ICE should clarify
who is responsible for enforcing its criminal and civil authorities. It should also
remove self-imposed limitations on its nationwide jurisdiction.

e Homeland Security Investigations (HSI) Special Agents in the 1811
series should enforce Title 8 and 18 crimes as the biggest part of their
portfolio. Alien smuggling, trafficking, and cross-border crime as defined
under Title 8° and Title 18° should be the focus of ICE operations.

e Therole of ICE Deportation Officers should be clarified. ICE
Enforcement and Removal Operations (ERO) should be identified as being
primarily responsible for enforcing civil immigration regulations, including
the civil arrest, detention, and removal of immigration violators anywhere
in the United States, without warrant where appropriate, subject only to the
civil warrant requirements of the INA where appropriate.

e AllICE memoranda identifying “sensitive zones” where
ICE personnel are prohibited from operating should be
rescinded. Rely on the good judgment of officers in the field to avoid
inappropriate situations.

e To maximize the efficient use of its resources, ICE should make full
use of existing Expedited Removal (ER) authorities. The agency has
limited the use of ER to eligible aliens apprehended within 100 miles of the
border. This is not a statutory requirement.

New Policies

U.S. national security and public safety interests would be well-served if ICE
were to be combined with CBP and USCIS, as mentioned above. Additionally, ICE/
HSI, along with CBP, should be full participants in the Intelligence Community.

The use of Blackies Warrants should be operationalized within ICE. These civil
search warrants are commonly used for worksite enforcement when agents have
probable cause that illegal aliens are employed at a business. This would stream-
line investigations.

Safeguarding Americans will require not just securing the border, but con-
tinuous vetting and investigations of many aliens who exploited President
Biden’s open border for potentially nefarious purposes, including some Afghan
evacuees sent directly to the U.S. during America’s disastrous withdrawal from
Afghanistan.

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Budget

e Congress should mandate and fund additional bed space for alien
detainees. ICE should be funded for a significant increase in detention
space, raising the daily available number of beds to 100,000.

e Congress should fund ICE for at least 20,000 ERO officers and 5,000
Office of the Principal Legal Advisor (OPLA) attorneys.

U.S. CITIZENSHIP AND IMMIGRATION SERVICES (USCIS)
US. Citizenship and Immigration Services (USCIS) is the agency tasked with
administering the legal immigration and certain temporary visa programs.

Needed Reforms

Since January 2021, USCIS’s priorities have been misaligned, and this has trans-
formed it into an open-borders agency, ignoring the critical role that it plays in
national security, public safety, and safeguarding the integrity of our immigration
system. USCIS should be returned to operating as a screening and vetting agency.
Regulatory efforts have focused on easing asylum eligibility in a manner that is
guaranteed to exacerbate asylum fraud as people surge at the border. Emphasis
also has been placed on removing legal barriers to immigration, such as the use
of public benefits. These actions violate statutes, erode congressional intent, and
provide a significant magnet for continued illegal immigration.

Additionally, USCIS resources have been misappropriated to focus more on
creating and expanding large-scale parole and temporary status programs that
violate the law and are otherwise contrary to congressional intent instead of focus-
ing on amore secure and efficient process for those who are seeking benefits. The
ever-increasing number of applications filed has made it difficult to vet applica-
tions adequately for eligibility, fraud, and specific national security and public
safety problems.

The Fraud Detection and National Security Directorate (FDNS) is currently a
small directorate with assigned officers reporting through the chain of command in
the field, and this has led to stovepiping, lack of coordination in national policy, and
inconsistencies throughout the agency. To prioritize vetting and fraud detection,
FDNS should undergo a structural shift focused on direct reporting from the field
to headquarters, reclassification of leadership, and FDNS directives taking prece-
dence over those of other component entities. Correcting the current misalignment
of agency priorities and resources should begin with this primary shift in focus to
vetting and fraud detection. These actions would reform the agency, returning it
to its screening and vetting mission in protecting the homeland.

Other structural changes should include reimplementation of the USCIS denat-
uralization unit—an effort to maintain integrity in the system by identifying and

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prosecuting criminal and civil denaturalization cases, in combination with the

Department of Justice, for aliens who obtained citizenship through fraud or other

illicit means. Additionally, USCIS should create a criminal enforcement compo-
nent within the agency to investigate immigration benefits fraud under Title 8

(perhaps requiring additional legislative and regulatory authorities for the offi-
cers themselves) and to prosecute cases through Special Assistant U.S. Attorneys

(SAUSAs) with substantive knowledge in the field. Particular attention should be

given to addressing increasing incidents of forced labor trafficking in temporary

work visa programs.

While the Biden regulatory agenda has focused on at least two major rules—the
credible fear rule and the public charge rule—USCIS has utilized other policy and
internal procedural mechanisms to extend employment authorization to large
groups of people who are in the country without legal status. The agency has
taken quiet steps to cut corners and lessen adjudicatory standards. During a tran-
sition period, a complete audit of agency policies, memoranda, and management
directives issued during the Biden Administration should be completed, and rescis-
sion documents should be prepared for issuance within the first few days of the
incoming Administration. Additionally, regulatory documents should be drafted
to review or reverse all regulations promulgated during the Biden Administration.

New Policies

To advance the national interest, the three core immigration agencies— USCIS,
ICE, and CBP—should remerge and have immigration elements outside of DHS
(such as ORR of HHS) included. The fragmented immigration enforcement frame-
work that developed in the wake of the Homeland Security Act has weakened
each agency and should be remediated. Combining these critical agencies would
strengthen their capabilities, ensure cooperation, and promote information-shar-
ing. Agency responsibilities and the delineation of authorities, such as inconsistent
use of deferred action and issuance of NTAs by each agency, have long been a point
of contention that would be addressed much more easily if they were recombined
into a single entity.

Alternatively, new policies for USCIS as it currently exists should focus on mat-
ters that can be addressed through administrative action.

e The workforce should be realigned and, as necessary, retrained on base
eligibility and fraud detection rather than speed in processing.

e Training should be returned to Federal Law Enforcement Training Centers

(FLETC), which would underscore the enforcement role of USCIS asa
vetting agency, and be rebranded accordingly.

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e Management Directives and policies should realign to ensure that the
workforce, while adaptable and able to handle the bulk of the USCIS mission,
is not allowed to be pulled off mission work to focus on unlawful programs
(DACA, mass parole for Afghans, Ukrainians, Venezuelans, etc.), which
divert resources away from nuclear family and employment programs.

The regulatory agenda should include the immediate submission of notices of
proposed rulemaking for the Trump Administration’s public charge rule (includ-
ing aspects from its original notice of proposed rulemaking), temporary work
visa reform, employment authorization reform rules, asylum bars rule, and a
third-country transit rule. Ata minimum, an enhanced regulatory agenda should
include rules strengthening the integrity of the asylum system, parole reform, and
U visa reform that prioritizes relief for victims of heinous crimes and ensures that
we protect the truest and most deserving victims of crime.

Not all policy changes require formal rulemaking, however, as internal guidance
documents are generally exempt under the Administrative Procedure Act (APA).”
In this subregulatory space, USCIS policy memos and operational guidance should
reduce the validity of employment authorization documents and end the COVID
flexibilities, including the reliance on biometrics reuse. USCIS should also enforce
existing regulations by rejecting incomplete applications and petitions, ensuring
both that they are completed before accepted for filing and that FDNS signs off on
all approved applications and petitions before approval notices are sent to the alien
or petitioner. Other efforts should be focused on adjudication standards returning
to nearly 100 percent interview requirements for all appropriate cases.

The incoming Administration should spearhead an immigration legislative
agenda focused on creating a merit-based immigration system that rewards high-
skilled aliens instead of the current system that favors extended family-based and
luck-of-the-draw immigration. To that end, the diversity visa lottery should be
repealed, chain migration should be ended while focusing on the nuclear family,
and the existing employment visa program should be replaced with a system to
award visas only to the “best and brightest.”

Internal efforts to limit employment authorization should be matched by con-
gressional action to narrow statutory eligibility to work in the United States and
mitigate unfair employment competition for U.S. citizens. The oft-abused H-1B
program should be transformed into an elite program through which employers
are vying to bring in only the top foreign workers at the highest wages so as not to
depress American opportunities. Additionally, Congress should:

e Improve the integrity of the temporary work visa programs;

e Repeal Temporary Protected Status (TPS) designations;

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e Permanently authorize and make mandatory E-Verify; and
e End parole abuse by legislating specific parole standards.

USCIS should make it clear that where no court jurisdiction exists, it will not
honor court decisions that seek to undermine regulatory and subregulatory efforts.
Finally, USCIS still requires access to all relevant national security and law enforce-
ment databases in the same vein as any other agency in the intelligence space. This
is a key concept that should be addressed as USCIS is returned to functioning
primarily as a vetting agency.

Budget

USCIS is primarily fee-funded, operating on revenue derived by those who are
seeking immigration benefits, work permits, and naturalization. The total agency
budget requested for fiscal year (FY) 2023, including both fees and a small appropri-
ation, is slightly less than $6 billion.’ The bulk of funds are derived from application
fees through the Immigrant Examinations Fee Account. As a general principle, adju-
dication of applications and petitions should be paid by applicants, not American
taxpayers. It is critical that any changes in the budget, even in the wake of a realigned
agency combined with ICE and CBP, should retain a fee-funded model.

Given the Obama and Biden Administrations’ lack of will, fees should be
increased agencywide to keep in step with inflation and the true cost of the adju-
dications. The incoming Administration should immediately submit a fee rule
that reflects such an increase. Aside from an increase in all fees, the rule should
drastically limit the availability for fee waivers and should implement a fee for
asylum applications. Additionally, Congress should allow for a 10 percent across-
the-board increase in all fees for all fee rules to account for the fact that new fee
rules always lag behind budget requirements.

USCIS should strive to increase opportunities for premium processing, a ben-
efit by which applicants can expedite their processing times. While this places
time burdens on adjudicators, it provides an opportunity for a significant influx
of money into the agency, which is not currently available. While simply raising
fees to the necessary levels to make the agency run efficiently would be prefera-
ble, without the need for expanded premium processing, this short-term measure
should be utilized, particularly if longer-term fee rules are unsuccessful.

At least until USCIS is caught up on all case backlogs, all applicants rejected for
any benefit or status adjudication should be required to leave the U.S. immediately.
Ordinary process can resume once all case backlogs have been adjudicated.

Finally, USCIS should pause the intake of applications in a benefit category
when backlogs in that category become excessive. Once USCIS adjudicators can
decrease that caseload to a manageable number, application intake should resume.

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Personnel

USCIS should be classified as a national security-sensitive agency, and all of
its employees should be classified as holding national security-sensitive posi-
tions. Leaks must be investigated and punished as they would be in a national
security agency, and the union should be decertified. Any employees who cannot
accept that change and cannot conform their behavior to the standards required
by such an agency should be separated. USCIS’s D.C. personnel presence should
be skeletal, and agency employees with operational or security roles should be
rotated out to offices throughout the United States. These USCIS employees
should live and work in the communities that are most affected by their daily
duties and decisions.

NECESSARY BORDER AND IMMIGRATION STATUTORY,
REGULATORY, AND ADMINISTRATIVE CHANGES

The current border security crisis was made possible by glaring loopholes
in our immigration system. The result was a preventable and predictable his-
toric increase in illegal and inadmissible encounters along our southern border.
This pulled limited resources from the front lines of our nation’s borders and
away from their national security mission, releasing a vast and complex set
of threats into our country. To regain our sovereignty, integrity, and security,
Congress must pass meaningful legislation to close the current loopholes and
prevent future Administrations from exploiting them for political gain or per-
sonal ideology.

Legislative Proposals

e Title 42 authority in Title 8. Create an authority akin to the Title 42
Public Health authority that has been used during the COVID-19 pandemic
to expel illegal aliens across the border immediately when certain non-
health conditions are met, such as loss of operational control of the border.

e Mandatory appropriation for border wall system infrastructure. The
monies appropriated would be used to fund the construction of additional
border wall systems, technology, and personnel in strategic locations in
accordance with the Border Security Improvement Plan (BSIP).

e Appropriation for Port of Entry infrastructure. Border security is not
addressed solely by systems in between the ports of entry. POEs require
technology and physical upgrades as well as an influx of personnel to meet
capacity demands and act as the literal gatekeepers for the country. This is
the first line of defense against drug and human smuggling operations.

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e Unaccompanied minors

1. Congress should repeal Section 235 of the William Wilberforce
Trafficking Victims Protection Reauthorization Act of 2008 (TVPRA),?
which provides numerous immigration benefits to unaccompanied
alien children and only encourages more parents to send their children
across the border illegally and unaccompanied. These children too often
become trafficking victims, which means that the TVPRA has failed.

2. Ifanalternative to repealing Section 235 of the TVPRA is necessary,
the section should be amended so that all unaccompanied children,
regardless of nationality, may be returned to their home countries ina
safe and efficient manner. Currently, the TVPRA allows only children
from contiguous countries (Canada and Mexico) to be returned while
every other unaccompanied minor must be placed into a lengthy
process that usually results in the minor’s landing in the custody of an
illegal alien family member.

3. Congress must end the Flores Settlement Agreement by explicitly
setting nationwide terms and standards for family and unaccompanied
detention and housing. Such standards should focus on meeting human
needs and should allow for large-scale use of temporary facilities (for
example, tents).

4. Congress should amend the Homeland Security Act and portions of
the TVPRA to move detention of alien children expressly from the
Department of Health and Human Services to DHS.

e Asylum reform
1. The standard for a credible fear of persecution should be raised and
aligned to the standard for asylum. It should also account specifically for
credibility determinations that are a key element of the asylum claim.
2. Codify former asylum bars and third-country transit rules.
3. Congress should eliminate the particular social group protected ground
as vague and overbroad or, in the alternative, provide a clear definition

with parameters that at a minimum codify the holding in Matter of A-B-
that gang violence and domestic violence are not grounds for asylum."

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Parole reform. Congress should end the widespread abuse of parole in
contravention of statute and return it to its origins as an extraordinary
remedy for very limited purposes.

NGOs and processing. Congress should halt funds given to
nongovernmental organizations (NGOs) to process and transport
illegal aliens into and throughout the United States. Such funds and
infrastructure, including the DHS joint processing centers, should be
redirected to secure the border, detain aliens, and provide space for
immigration court proceedings.

Other pathways for border crossers. While Congress should use its
oversight authority to ensure that Expedited Removal is used to the fullest
extent and followed to the letter of the law, other paths for border crossers
should be included in a legislative package.

1. Migrant protection protocols. Update the statutory language
providing the basis for the Remain in Mexico program as needed to
withstand judicial scrutiny and executive inaction.

2. Asylum Cooperative Agreements. While the agreements themselves
must be negotiated, Congress should mandate that the executive branch
work faithfully to negotiate and execute ACAs and set parameters
to ensure that an unwilling executive cannot renege on an existing
agreement or abandon the effort.

3. Other expedited pathways. Congress should explicitly permit
programs akin to the Prompt Asylum Claim Review (PACR) and
Humanitarian Asylum Review Process (HARP) programs.

Employment authorization

1. Congress should reassert control of employment authorization, which is
subject to rampant regulatory abuse, and limit it to certain categories of

legal immigrants and non-immigrants.

2. Congress should also permanently authorize E-Verify and make
it mandatory.

State and local law enforcement

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1. Congress should unequivocally authorize state and local law
enforcement to participate in immigration and border security actions
in compliance with Arizona v. United States."

2. Congress should require compliance with immigration detainers to
the maximum extent consistent with the Tenth Amendment and set
financial disincentives for jurisdictions that implement either official or
unofficial sanctuary policies.

Prosecutorial discretion. Congress should restrict the authority for
prosecutorial discretion to eliminate it as a “catch-all” excuse for limiting
immigration enforcement.

Mandatory detention. Congress should eliminate ambiguous
discretionary language in Title 8 that aliens “may” be detained and clarify
that aliens “shall” be detained. This language, which contrasts with other

“shall detain” language in statute, creates unhelpful ambiguity and allows the
executive branch to ignore the will of Congress.

Regulations

Withdraw Biden Administration regulations and reissue new
regulations in the following areas:

1. Credible Fear/Asylum Jurisdiction for Border Crossers.
2. Public Charge.

T-Visa and U-Visa reform. Unless and until T and U visas are repealed,
each program needs to be reformed to ensure that only legitimate victims
of trafficking and crimes who are actively providing significant material
assistance to law enforcement are eligible for spots in the queue.

Repeal TPS designations.

H-1B reform. Transform the program into an elite mechanism

exclusively to bring in the “best and brightest” at the highest wages while
simultaneously ensuring that U.S. workers are not being disadvantaged by
the program. H-1B is a means only to supplement the U.S. economy and to
keep companies competitive, not to depress U.S. labor markets artificially in
certain industries.

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e Employment authorization. Along with the legislative proposal, take
regulatory action to limit the classes of aliens eligible for work authorization.

Executive Orders
e Pathways for border crossers

1. Direct the Department of State and the Department of Homeland
Security to reinstate Asylum Cooperative Agreements with Northern
Triangle Countries immediately.

2. Recommence negotiations with Mexico to fully implement the Remain
in Mexico Protocols.

3. Reinstate, to the extent possible, expedited pathways with full credible
fear/immigration court process (PACR and HARP).

4. Prohibit the use of Notices to Report, the use of any funds for travel
into the interior of the United States, and government flights or
transportation for aliens.

5. Mandate that ICE use all detention space in full compliance with
Section 235 of the INA, issue weekly reports on detention capacity, and
provide authority for low-level temporary capacity (for example, tents)
once permanent space is full.

6. Eliminate the use of ATD for border crossers except in rare cases and
only with the explicit authority of the Secretary.

7. Prohibit the use of parole except in matters that are certified by the
Secretary of Homeland Security as requiring action for humanitarian or
significant public benefit reasons, and prohibit the use of parole in any
categorical circumstance.

e Enforcement

1. Restrict prosecutorial discretion to eliminate it as a “catch-all” excuse
for limiting immigration enforcement.

2. Mandate the use of E-Verify for anyone doing business with
the government.

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3. Designate USCIS as Intelligence Community-adjacent, ensuring that it
has access to national security and law enforcement databases.

4. Rescind all memoranda limiting enforcement of immigration laws
including those identifying sensitive zones.

5. End ICE’s widespread use of termination and administrative closure of
cases in immigration court.

e ©6Averting or curtailing a mass migration event

1. Provide that whenever the Secretary of Homeland Security determines
that an actual or anticipated mass migration of aliens en route to or
arriving off the coast of the U.S. presents urgent circumstances requiring
an immediate federal response, the Secretary may make, subject to the
approval of the President, rules and regulations prohibiting in whole or
in part the introduction of persons from such countries or places as he
or she shall designate in order to avert or curtail such mass migration
and for such period of time as is deemed necessary, including through
the expulsion of such aliens. Such rule and regulation making shall not
be subject to the requirements of the Administrative Procedures Act.

2. Provide that notwithstanding any other provision of law, when the
Secretary makes such a determination and then promulgates, subject to
the approval of the President, such rules and regulations, the Secretary
shall have the authority to waive all legal requirements of Title 8 that
the Secretary, in his or her sole discretion, determines are necessary to
avert or curtail the mass migration.

Subregulatory Matters
e USCIS priorities/structural changes

1. Ensure that focus is returned to vetting, base eligibility of applicants,
and fraud detection.

2. Realign the Fraud Detection and National Security Directorate (FDNS)
to ensure agencywide consistency on implementation of fraud detection

and vetting policies.

3. Review and repeal any internal agency memo that is inconsistent with
the priorities described in this chapter.

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e 287(g) program. Issue amemo prohibiting any jurisdiction that applies
from being denied access to the program unless good cause is shown.

e Homeland Security Investigations (HSI) priorities. Issue Department
Management Directive (and ICE companion Directive) to refocus HSI
on immigration offenses and criminal offenses typically associated with
immigration (for example, human trafficking). All criminal investigative
work without a clear nexus to the border or otherwise to Title 8 should be
turned over to the appropriate federal agency.

e Blackie’s Warrants. ICE OPLA, ERO, and HSI should issue a joint internal
memo on operationalizing Blackie’s Warrants for immediate use on
worksite enforcement and other appropriate investigations and operations.

FEDERAL EMERGENCY MANAGEMENT AGENCY (FEMA)

Needed Reforms

FEMA is the lead federal agency in preparing for and responding to disasters,
but it is overtasked, overcompensates for the lack of state and local preparedness
and response, and is regularly in deep debt. After passage of the 1988 Stafford Act,”
the number of declared federal disasters rose dramatically as most disaster costs
were shifted from states and local governments to the federal government. In
addition, state-friendly FEMA regulations, such as a “per capita indicator,” failed
to maintain the pace of inflation and made it easy to meet disaster declaration
thresholds. This combination has left FEMA unprepared in both readiness and
funding for the truly catastrophic disasters in which its services are most needed.
Reform of FEMA requires a greater emphasis on federalism and state and local
preparedness, leaving FEMA to focus on large, widespread disasters.

Under the Stafford Act, FEMA has the authority to adjust the per capita indi-
cator for damages, which creates a threshold under which states and localities are
not eligible for public assistance. FEMA should raise the threshold because the per
capita indicator has not kept pace with inflation, and this over time has effectively
lowered the threshold for public assistance and caused FEMA’s resources to be
stretched perilously thin. Alternatively, applying a deductible could accomplish
a similar outcome while also incentivizing states to take a more proactive role in
their own preparedness and response capabilities. In addition, Congress should
change the cost-share arrangement so that the federal government covers 25 per-
cent of the costs for small disasters with the cost share reaching a maximum of 75
percent for truly catastrophic disasters.

FEMA is also responsible for the National Flood Insurance Program (NFIP),
nearly all of which is issued by the federal government. Washington provides

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insurance at prices lower than the actuarially fair rate, thereby subsidizing flood

insurance. Then, when flood costs exceed NFIP’s revenue, FEMA seeks taxpay-
er-funded bailouts. Current NFIP debt is $20.5 billion, and in 2017, Congress

canceled $16 billion in debt when FEMA reached its borrowing authority limit.
These subsidies and bailouts only encourage more development in flood zones,
increasing the potential losses to both NFIP and the taxpayer. The NFIP should

be wound down and replaced with private insurance starting with the least risky
areas currently identified by the program.

Budget Issues

FEMA manages all grants for DHS, and these grants have become pork for states,
localities, and special-interest groups. Since 2002, DHS/FEMA have provided
more than $56 billion in preparedness grants for state, local, tribal, and territorial
governments. For FY 2023, President Biden requested more than $3.5 billion for
federal assistance grants.'* Funds provided under these programs do not provide
measurable gains for preparedness or resiliency. Rather, more than any objective
needs, political interests appear to direct the flow of nondisaster funds.

The principles of federalism should be upheld; these indicate that states better
understand their unique needs and should bear the costs of their particularized
programs. FEMA employees in Washington, D.C., should not determine how bil-
lions of federal tax dollars should be awarded to train local law enforcement officers
in Texas, harden cybersecurity infrastructure in Utah, or supplement migrant
shelters in Arizona. DHS should not be in the business of handing out federal tax
dollars: These grants should be terminated. Accomplishing this, however, will
require action by Members of Congress who repeatedly vote to fund grants for
political reasons. The transition should focus on building resilience and return
on investment in line with real threats.

Personnel

FEMA currently has four Senate-confirmed positions. Only the Administrator
should be confirmed by the Senate; other political leadership need not be con-
firmed by the Senate. Additionally, FEMA’s “springing Cabinet position” should be
eliminated, as this creates significant unnecessary challenges to the functioning of
the whole of DHS at points in time when coordinated responses are most needed.

CYBERSECURITY AND INFRASTRUCTURE SECURITY AGENCY (CISA)
Needed Reforms
CISA is supposed to have two key roles: (1) protection of the federal civilian

government networks (.gov) while coordinating the execution of national cyber
defense and sharing information with non-federal and private-sector partners

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and (2) national coordination of critical infrastructure security and resilience. Yet
CISA has rapidly expanded its scope into lanes where it does not belong, the most
recent and most glaring example being censorship of so-called misinformation
and disinformation.

CISA’s funding and resources should align narrowly with the foregoing two
mission requirements. The component’s emergency communications and Chem-
ical Facility Anti-Terrorism Standards (CFATS) roles should be moved to FEMA;
its school security functions should be transferred to state homeland security
offices; and CISA should refrain from duplicating cybersecurity functions done
elsewhere at the Department of Defense, FBI, National Security Agency, and U.S.
Secret Service.

Of the utmost urgency is immediately ending CISA’s counter-mis/disinforma-
tion efforts. The federal government cannot be the arbiter of truth. CISA began
this work because of alleged Russian misinformation in the 2016 election, which
in fact turned out to be a Clinton campaign “dirty trick.” The Intelligence Commu-
nity, including the NSA or DOD, should counter foreign actors. At the time of this
writing, release of the Twitter Files has demonstrated that CISA has devolved into
an unconstitutional censoring and election engineering apparatus of the political
Left. In any event, the entirety of the CISA Cybersecurity Advisory Committee
should be dismissed on Day One.

For election security, CISA should help states and localities assess whether
they have good cyber hygiene in their hardware and software in preparation for
an election—but nothing more. This is of value to smaller localities, particularly by
flagging who is attacking their websites. CISA should not be significantly involved
closer to an election. Nor should it participate in messaging or propaganda.

U.S. COAST GUARD (USCG)

Needed Reforms

The U.S. Coast Guard fleet should be sized to the needs of great-power compe-
tition, specifically focusing efforts and investment on protecting U.S. waters, all
while seeking to find (where feasible) more economical ways to perform USCG
missions. The scope of the Coast Guard’s mission needs to be focused on protecting
U.S. resources and interests in its home waters, specifically its Exclusive Economic
Zone (200 miles from shore). USCG’s budget should address the growing demand
for it to address the increasing threat from the Chinese fishing fleet in home waters
as well as narcotics and migrant flows in the Caribbean and Eastern Pacific. Doing
this will require reversing years of shortfalls in shipbuilding, maintenance, and
upgrades of shore facilities as well as seeking more cost-effective ship and facility
designs. In wartime, the USCG supports the Navy, but it has limited capability and
capacity to support wartime missions outside home waters.

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New Policies

The Coast Guard’s mission set should be scaled down to match congressio-
nal budgeting in the long term, with any increased funding going to acquisitions
based on an updated Fleet Mix Analysis. The current shipbuilding plan is insuf-
ficient based on USCG analysis, and the necessary numbers of planned Offshore
Patrol Cutters and National Security Cutters are not supported by congressional
budgets. The Coast Guard should be required to submit to Congress a long-range
shipbuilding plan modeled on the Navy’s 30-Year Shipbuilding Plan. Ideally this
should become part of the Navy plan in anew comprehensive naval long-range
shipbuilding plan to ensure better coherency in the services’ requirements.

Outside of home waters, and following the Caribbean and Eastern Pacific, the
Coast Guard should prioritize limited resources to the nation’s expansive Pacific
waters to counter growing Chinese influence and encroachment. Expansion of
facilities in American Samoa and basing of cutters there is one clear step in this
direction and should be accelerated; looking to free association states (Palau, the
Federated States of Micronesia, and the Republic of the Marshall Islands) for
enhanced and persistent presence, assuming adequate congressional funding, is
another such step.

The Secretary of the Navy should convene a naval board to review and reset
requirements for Coast Guard wartime mission support. To inform and validate
these updated requirements, the Chief of Naval Operations and the Coast Guard
Commandant should execute dedicated annual joint wartime drills focused on
USCG’s wartime missions in the Pacific (the money for these activities should be
allocated from DOD). An interagency maritime coordination office focused on
developing and overseeing comprehensive efforts to advance the nation’s mari-
time interests and increase its military and commercial competitiveness should
be established.

Given the USCG’s history of underfunded missions, if the Coast Guard is to con-
tinue to maintain the Arctic mission, money to do so adequately will be required
over and above current funding levels. Consideration should be given to shifting
the Arctic mission to the Navy. Either way, the Arctic mission should be closely
coordinated with our Canadian, Danish, and other allies.

Personnel

USCG is facing recruitment challenges similar to those faced by the military
services. The Administration should stop the messaging on wokeness and diversity
and focus instead on attracting the best talent for USCG. Simultaneously, consis-
tent with the Department of Defense, USCG should also make a serious effort to
re-vet any promotions and hiring that occurred on the Biden Administration’s
watch while also re-onboarding any USCG personnel who were dismissed from
service for refusing to take the COVID-19 “vaccine,” with time in service credited

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to such returnees. These two steps could be foundational for any improvements
in the recruiting process.

U.S. SECRET SERVICE (USSS)

Needed Reforms

The US. Secret Service must be the world’s best protective agency. Currently, the
agency is distracted by its dual mission of protection and financial investigations.
The result has been a long series of high-profile embarrassments and security fail-
ures, perhaps most notably its allowing of then-Vice President-elect Kamala Harris
to be inside the Democratic National Committee office on January 6, 2021, while
a pipe bomb was outside. Despite the great size and scope of the January 6 inves-
tigation, this high-profile incident of danger to a protectee remains unresolved.

The failures of the USSS protective mission are too numerous to list here. A
December 2015 bipartisan report from the House Oversight Committee listed
dozens of such incidents as well as needed recommendations for reform." This
chapter adopts those findings and recommendations in whole, especially the
finding that USSS’s dual-mission structure detracts from the agency’s protective
capabilities.

At the time of that report, USSS agents spent only one-third of their work hours
on protection-related activities as opposed to investigative activities. USSS was
established initially to investigate counterfeit currency, but its mission has evolved
over the decades to prioritize electronic financial crimes. For example, as this chap-
ter was being written, all 15 of the USSS’s most wanted individuals were wanted
for financial crimes, many of them international in nature.

Notably, the last head of the agency left not for a protection-related job, but to be
the Chief Security Officer of social media company SnapChat. This is a pattern that
has developed over the years, with agents seeking to burnish their online financial
crimes credentials to secure corporate security jobs. Coupled with some of the
lowest morale in the federal government, the agency has completely lost sight of
the primacy of its protective mission.

New Policies

USSS should transfer to the Department of Justice and Department of the
Treasury all investigations that are not related to its protective function. It should
begin the logistical operation of closing all field offices throughout the country and
internationally to the extent they are not taken over by Treasury or Justice. USSS
agents stationed outside of Washington, D.C., should be transferred to work in
Immigration and Customs Enforcement field offices where they would continue to
be the “boots on the ground” to follow up on threat reports throughout the country
and liaise with local law enforcement for visits by protectees.

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The only investigations not related to USSS’s protective function that agents
should pursue would be directed by HSI and relate to tracking the financial crimes
associated with illegal immigration. This should include tracing remittances, any
funds that are used to pay coyotes or the cartels, and payments by businesses to
illegal aliens and all other crimes associated with illegal immigration.

USSS should keep visitor logs for all facilities where the President works or
resides. The Biden Administration has evaded such transparency with President
Biden spending a historic amount of time for a President at his Delaware residence.
This has left the American people in the dark as to who is influencing the highest
levels of their own government.

Budget

The suggested reforms would result in a significant USSS budget reduction,
primarily because the agency would relinquish dozens of physical offices through-
out the U.S. and internationally. Some amount of savings should be used to fix the
personnel problems and for recruitment initiatives aimed at individuals who are
inclined to join a protection-focused agency.

Personnel

As documented extensively in the above-referenced 2015 bipartisan congressio-
nal report, low morale and high turnover are key drivers of USSS problems. With
their mission focused on protection, agents would no longer spend the bulk of
their time developing unrelated skillsets. Instead, USSS agents could hone their
protection skills and pursue a protection career path in the agency rather than
quickly leaving USSS for high-paying corporate security jobs.

The Uniform Division (UD) of USSS requires a significant staffing increase.
As documented in the bipartisan report, understaffing results in unpredictable
and long hours, which in turn result in high turnover, which only compounds
the problem.

Another key issue is that UD officers lack the ability to enforce criminal laws
outside the immediate vicinity of the White House. As the District of Columbia
is a federal jurisdiction and currently is beholden to the trend of progressive pro-
crime policies, UD officers should enforce all applicable laws. The result would
be to allow UD officers to gain more law enforcement experience—an attractive
credential that would improve morale.

TRANSPORTATION SECURITY ADMINISTRATION (TSA)

The TSA model is costly and unwisely makes TSA both the regulator and the
regulated organization responsible for screening operations. As part of an effort
to shrink federal bureaucracies and bring private-sector know-how to govern-
ment programs, TSA is ripe for reform. The U.S. should look to the Canadian and

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European private models of providing aviation screening manpower to lower TSA
costs while maintaining security. Until it is privatized, TSA should be treated asa
national security provider, and its workforce should be deunionized immediately.

TSA could privatize the screening function by expanding the current Screening
Partnership Program (SPP) to all airports. TSA would turn screening operations
over to airports that would choose security contractors that meet TSA regulations
and would oversee and test airports for compliance. Alternatively, it could adopt
a Canadian-style system, turning over screening operations to a new government
corporation that contracts screening service to private contractors. Contractors
would bid to provide their services to a set of airports in a particular region, likely
with around 10 regions nationally. TSA would continue to set security regulations
and test airports for compliance, and the new corporation would establish any oper-
ating procedures or customer service standards. With either model, the intelligence
function for domestic travel patterns should remain with the U.S. government.

The federal government could expect to save 15 percent-20 percent from the
existing aviation screening budget, but savings could be significantly larger. Service
to travelers should also improve.

MANAGEMENT DIRECTORATE (MGMT)

The Management Directorate is unnecessarily large because each individual
component also maintains its own respective management office. Too much over-
lap and red tape exist between headquarters (HQ) and components with regard
to such functions as hiring, information technology, and procurement. Finance
is unique given that HQ needs to address reprogramming, and component bud-
gets need to roll up into all-department budgets. The Directorate requires intense
reform, the specifics of which should be further assessed given its expansive nature.

Front Office (FO). Immediately place a small team of advisers with a deep
understanding of operational management—but who have some experience in
government because they will need to understand the nuance of Reduction in Force
(RIF), appropriations hurdles when dealing with U.S. government reorganization,
etc.—to sit inthe MGMT FO (reporting to the Secretary, ultimately either S1 or $2).
One of these advisers should understand U.S. government employment law and
be prepared to relocate personnel and downsize offices accordingly. This includes
reverting to the original understanding of the function of individuals appointed
to the Senior Executive Service: competent managers who can work capably with
any subject matter and in any location.

Over the first few months of the Administration, the advisers’ role should be
to assess what structural and procedural changes are appropriate. They should
dissect the current standing Management Directives and the approval processes
in place to implement and/or change them; Office of the Chief Human Capital
Officer’s processes and procedures; hurdles to the Office of Chief Procurement

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Officer’s procurement of innovative technology; and the facilities plan, including
the consolidation into the St. Elizabeth’s campus. They should also be prepared
to help implement any end to unionization of DHS components in response to an
executive order pursuant to 5 U.S.C. 7103.°

Office of the Chief Financial Officer (OCFO). DHS responsibilities to work with
Congress have been split between the Office of Legislative Affairs (OLA) and OCFO.
OLA deals with the authorizing committees on policy issues, and OCFO works with
the appropriations committees on budget planning, execution, and reprogramming.
This split creates communication and visibility issues within DHS and inconsistency in
answers to Congress. This is an issue not only within the HQ model, but also through-
out the components. Either appropriations personnel should be moved to OLA and
there should be a “dotted line” reporting structure to OCFO, or a policy that OLA per-
sonnel must be included on communications to Congress should be implemented.

To avoid “answer shopping” by congressional staff, particularly appropriations
staff, all budget communications from the OCFO, including from the CFO him/
herself, should first be provided to the Director of OLA to ensure consistency of
information, messaging, and answers. This may be deemed awkward given that the
OCFO is a Senate-confirmed position, but it is necessary to avoid inaccuracies and
inconsistencies in messaging.

Federal Protective Service (FPS). FPS needs federal agents to develop, share,
and receive operational information and maintain direct contact with the Secretary
in the midst of heightened threats. Before the summer 2020 civil unrest, position-
ing FPS under MGMT was justified, but given the current climate, they should not
be reporting through MGMT. This may be especially problematic if a Management
Directorate Under Secretary lacking law enforcement or military experience is in place
when a situation like summer 2020 arises. FPS should report to the Secretary as other
components (e.g., FLETC) do. This would add little to the Secretary’s current burden
unless or until civil unrest arises, at which point reporting to the Secretary creates a
direct line between the primary DHS decision-maker (S1 or S2) and the FPS Director.

Regarding operational communication, there should be information-sharing
mandates (MOAs)—which are applicable under specific circumstances where fed-
eral facilities are involved—between FPS and the U.S. Marshals, U.S. Park Police,
and FBI. Agreements with U.S. Capitol Police and Supreme Court Police should
also be considered, but it is noteworthy that those entities are jurisdictionally out-
side of the executive branch.

OFFICE OF STRATEGY, POLICY, AND PLANS (PLCY)

Department-Level Reforms. PLCY should perform a complete inventory,
analysis, and reevaluation of the department’s domestic terrorism lines of effort
to ensure that they are consistent with the President’s priorities, congressional
authorization, and Americans’ constitutional rights.

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PLCY should likewise do a complete inventory, analysis, and evaluation of any
of the department’s work, in coordination with social media outlets, to censor or
otherwise change or affect Americans’ speech. PLCY should comprehensively
report on and publish this history in full so that the American people can know
the facts. The department should remove all personnel who participated in any
of this activity.

The department has significant authority and budget to provide grants for var-
ious purposes. This effort is diffused across components and lacks central policy
thought and coordination. PLCY should set a departmentwide policy that estab-
lishes how granting choices are to be made and is consistent with the President’s
priorities. PLCY should clear all granting decisions to ensure that they are con-
sistent with the new policy.

PLCY-Wide Reforms. PLCY should work with Congress to streamline the
department’s reporting requirements. Because there has not been a departmen-
tal reauthorization bill and these requirements have been added piecemeal over
two decades, they significantly overlap and even conflict—wasting resources and
distracting from the department’s mission. PLCY should seek the elimination of
the Quadrennial Homeland Security Review.

Issue-Area Reforms. PLCY should bolster its Immigration Statistics program
and make it the one-stop shop for the timely production of all department immi-
gration statistics and analysis.

OFFICE OF INTELLIGENCE AND ANALYSIS (l&A)

The Office of Intelligence and Analysis should be eliminated both because
it has not added value and because it has been weaponized for domestic politi-
cal purposes.

The Intelligence Community (IC) already provides raw intelligence to DHS
components. In addition, the FBI, National Counter Terrorism Center, and other
agencies where necessary already provide holistic threat assessment products to
federal, state, local, tribal, and territorial governments as well as to private-sector
entities at both the classified and unclassified levels where appropriate. I&A’s work
as an interlocuter between the IC and DHS components’ individual intelligence
operations on the one hand and government and the private sector on the other,
as well as between the IC and the components, is at best duplicative. At worst, it
is used and discussed in the mediaas a political tool, resulting in more harm than
good to the U.S. government and IC writ large.

The Cybersecurity and Infrastructure Security Agency, which is not a member
of the IC, should create cyber intelligence products in a collaborative fashion with
the National Security Agency and U.S. Cyber Command. Such efforts would lead
to timelier usable classified and unclassified products for stakeholders that exceed
the quality and capability of I&A’s efforts. This same principle applies to other

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components as well: CBP, TSA, etc. all have their own intelligence operations and
are better situated with their subject-matter experts to make their own assessments.

The National Operations Center (NOC) within the Office of Operations Coor-
dination (OPS) should absorb those select I&A functions and tactically proficient
personnel that need to be maintained (for example, technical support to the
National Vetting Center). The remainder of I&A should be eliminated. The OPS
entity should maintain IC status, and the only intelligence mission set should be
to provide situational awareness and the dissemination of operational information
or raw intelligence (no analysis or products) at classified and unclassified levels to
executive leadership across the department, not outside of DHS.

OFFICE OF THE GENERAL COUNSEL (OGC)

Needed Reforms

OGC should advise principals as to how DHS can execute its missions within
the law instead of advising principals as to why they cannot execute regulations,
policies, and programs.

Instead of each component’s chief counsel reporting to the Headquarters Gen-
eral Counsel (with a solid line) and indirectly to his or her component head (with
a dotted line), the accountability should be reversed. Due to the different missions
throughout the department, the components can better manage the legal issues
of their specific mission than headquarters can. Thus, the chief counsel (or equiv-
alent) of each component should report directly to the component head, report
indirectly to the DHS General Counsel, and be accountable to the component head.
The report to the General Counsel is to ensure consistency of advice across DHS.

OGC should hire significantly more Schedule C/political appointees who in
turn supervise career staff and manage their output. DHS’s mission is politically
charged, and the legal function cannot be allowed to thwart the Administration’s
agenda by providing stilted or erroneous legal positions and decision-making.

OGC should serve as the center of the response to the legal challenges facing the
department to ensure a streamlined, consistent response to a litany of issues facing
the department. It is important to ensure consistency across all potential legal
positions taken by the department, including those arising in litigation, congressio-
nal oversight, and inquiries received from the Inspector General, U.S. Government
Accountability Office (GAO), and Congressional Research Service and pursuant to
the Freedom of Information Act.

OGC should invest in e-discovery software and contract with a vendor to manage
the department’s e-discovery. This would be beneficial both in litigation and in
responding to congressional oversight. Removing delays in e-discovery processing
would also reduce the issuance of subpoenas to the department and the generation
of negative press for the Administration that comes from delayed responses.

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The old practice of relying on Executive Secretary taskings to pull documents for
congressional requests does not work: It is slow, the metrics for what documents
are gathered and how are unclear, and the components do not gather responsive
material in an efficient manner. Document gathering should come from the Office
of the Chief Information Officer or a relevant technological element within the
department that can pull responsive communications quickly.

OFFICE OF LEGISLATIVE AFFAIRS (OLA); OFFICE
OF PUBLIC AFFAIRS (OPA); AND OFFICE OF
PARTNERSHIP AND ENGAGEMENT (OPE)

DHS’s external communications function should be consolidated and reformed
so that the President’s agenda can be implemented more effectively. The Office of
Partnership and Engagement should be merged into the Office of Public Affairs.
In many Cabinet agencies, outreach to companies and partner organizations is
similarly performed by the Office of Public Affairs. This would also accomplish a
needed DHS organizational and management reform to decrease the number of
direct reports to the Secretary.

Both public and legislative affairs staff in the components should report directly
to their respective headquarters equivalent. This would help to avoid a failure by
the department to speak with one voice. It would also allow the component staff to
perform more efficiently, overseen by expert managers in their trade. This would
also allow DHS to respond to crises effectively by shifting staff as needed to the
most pressing issues and better use underutilized staff at less active components.

Only political appointees in OLA should interact directly with congressional staff
on all inquiries, including budget and appropriations matters. To prevent congres-
sional staff from answer shopping among HQ OLA, the DHS OCFO, and components,
DHS legislative affairs appropriations staff should be moved from MGMT OCFO
into OLA. Regarding components, budget/appropriations staff should move from
component budget offices into component legislative affairs offices.

Because dozens of congressional committees and subcommittees either have or
claim to have jurisdiction over some DHS function, DHS staff from the Secretary
on down spend so much time responding to congressional hearing and briefing
requests, letters, and questions for the record that they are left with little time
to do their assigned job of protecting the homeland. The next President should
reach an agreement with congressional leadership to limit committee jurisdiction
to one authorizing committee and one appropriations committee in each cham-
ber. If congressional leadership will not limit their committees’ jurisdiction over
DHS, DHS should identify one authorizing and appropriations committee in each
chamber and answer only to it.

To focus more precisely on the DHS mission, OLA staff should also identify
outdated and needless congressional reporting requirements and notify Congress

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that DHS will cease reporting on such matters. For other congressional reports,
OLA should implement a sunset date so that Congress must regularly demonstrate
the need for specific data.

In both OPA and OLA, a change in mission and culture is needed. The clients
of both components are the President and the Secretary, not the media, external
organizations, or Congress. OPA and OLA should change from being compliance
correspondents for outside entities airing grievances to serving as messengers and
advocates for the President and the Secretary.

OFFICE OF OPERATIONS COORDINATION (OPS)

OPS was originally conceived by then-Secretary Jeh Johnson as an entity tasked
with coordinating cross-DHS assets on an as-needed basis using a joint operations
approach. This role is particularly challenging because of the disparate nature of
mission sets across DHS.

OPS should absorb avery small number of tactical intelligence professionals from
I&A as the rest of IA is shut down. Such intelligence officers would be a subordinate
element within OPS placed within the National Operations Center. The intelligence
officers would provide tactical intelligence support for upcoming or ongoing opera-
tions in addition to liaising with their agency/component counterparts. There would
be no strategic intelligence analysis done as part of OPS or its new I&A sub-element.

In addition to facilitating all-of-DHS coordination on a task-by-task basis, OPS
would be responsible for ongoing situational awareness for the Secretary and
Deputy Secretary.

In addition to long-term staffing, OPS would have cycling billets from each of
the major agencies and components to facilitate its most effective working rela-
tionships across DHS.

OFFICE FOR CIVIL RIGHTS AND CIVIL LIBERTIES
(CRCL) AND PRIVACY OFFICE (PRIV)

The Homeland Security Act established only an Officer of CRCL, not an office.
The only substantive function Congress then assigned to the officer was to review
and assess information alleging abuses of civil rights. Since then, Congress and
CRCL itself have significantly expanded CRCL’s scope and size well beyond its
original intent or helpful purpose. CRCL now operates and views itself as a quasi-
DHS Office of Inspector General. This results in a considerable waste of limited
component resources, which are routinely tasked to address redundant, overly
burdensome, and uninformed demands from CRCL. It is therefore important to
recalibrate CRCL’s scope and reach.

The organizational structure of both CRCL and the Privacy Office should be
changed to ensure proper alignment with the department’s mission. The Office
of General Counsel should absorb both CRCL’s and PRIV’s necessary functions

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and staff. Although the CRCL Officer and the Freedom of Information Act (FOIA)
Officer/Privacy Officer are statutory, their offices are not mandatory. CRCL and
PRIV Officers and employees should report to a Deputy General Counsel, who
would be a political appointee.

The CRCL Officer should focus on equal employment opportunity (EEO)
compliance and the civil liberties function and investigate matters only within
Headquarters or support components. Operational components’ civil liberties offi-
cers should investigate incidents regarding their own agencies. The CRCL Officer
should ensure that all civil liberties or civil rights complaints are sent to the Office
of Inspector General (OIG) for review. If the OIG chooses not to investigate, the
CRCL Officer should only provide supportive information on possible courses of
action for complainants.

The PRIV Officer and FOIA Officer should focus on FOIA, Privacy Compliance
Policy, and Privacy Incident Response. The Deputy General Counsel should provide
guidance to DHS leadership regarding Privacy Compliance and Privacy Incident
Response. To ensure that only U.S. persons and Lawful Permanent Residents are
provided protections as required by the Privacy Act, all DHS issuances should be
updated to reflect that DHS protects the privacy of individuals as required by the
Privacy Act (US. persons and lawful permanent residents); the Judicial Redress
Act of 2015;” and any U.S.-European Union Data Protection and Privacy Agreement.

Because of the lack of public trust in the Office of Intelligence and Analysis,
CRCL and PRIV staff should no longer review intelligence products or provide
guidance on any intelligence products or reports.

A consistent, clear, and singular message is necessary for DHS’s mission.
Therefore, all communications and/or meetings with any federal, state, local, or
nongovernment groups should be limited to the Deputy General Counsel. In addi-
tion, given the narrower scope of work, OGC should disband the outside advisory
boards and the more than 50 working groups in which CRCL and PRIV currently
participate. Finally, CRCL and PRIV should no longer issue bulletins or periodicals.

OFFICE OF THE IMMIGRATION DETENTION OMBUDSMAN
(OIDO) AND OFFICE OF THE CITIZENSHIP AND
IMMIGRATION SERVICES OMBUDSMAN (CISOMB)

OIDO. The Office of the Immigration Detention Ombudsman should be
eliminated. This requires a statutory change in Section 106 of the Consolidated
Appropriations Act of 2020."8

OIDO was designed to create another impediment to detention through an
additional layer of so-called oversight. Several agencies already perform detention
oversight. ICE conducts internal audits of facilities and investigates complaints
against ICE agents through the Office of Professional Responsibility. Similarly, CBP
accepts individual complaints regarding facilities through the Joint Intake Center

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and manages complaints against agents through the OPR. In addition, CRCL, OIG,
GAO, and Congress all perform detention oversight. These multiple bodies place
unmanageable and unreasonable burdens on ICE to manage several sometimes
inconsistent audits/inspections at the same time.

IfOIDO remains a DHS component, the Secretary should immediately issue a direc-
tive stripping CRCL of its immigration portfolio. OIDO is in a better position with
dedicated resources and immigration experts to perform this function than CRCLis.
Allowing both offices to conduct detention oversight is duplicative and wasteful.

The Secretary should conduct a thorough review of the effectiveness of Direc-
tive 0810.1,” which is widely interpreted as requiring a wholesale referral of cases
to OIG. In reality, OIG investigates only a small fraction of them and often sits on
cases for longer than the five-day window specified in the directive. Meanwhile,
the other agencies wait in limbo to execute their duties.

CISOMB. The Office of the Citizenship and Immigration Services Ombudsman
should be eliminated. The DHS bureaucracy is too large, and the Secretary has too
many direct reports. CISOMB’s policy functions can be performed (and sometimes
already are) by OIG and GAO. The specialized case work can be moved into USCIS
as a special unit, much like the IRS Taxpayer Advocate. This would require a stat-
utory change to Section 452 of the Homeland Security Act of 2002.?°

If CISOMB continues as a DHS component, a policy should be issued that
prohibits CISOMB from assisting illegal aliens to obtain benefits. Currently,
approximately 15 percent-20 percent of CISOMB’s workload consists of helping
DACA applicants obtain and renew benefits, including work authorization. This
is not the role of an ombudsman. In addition, the government should be a neutral
adjudicator, not an advocate for illegal aliens.

AGENCY RELATIONSHIPS

Itis critical to the achievement of the President’s policy objectives that all agen-
cies and departments touching immigration policy work in sync with one another.
While there are numerous areas in which such cooperation is critical, immigration
has proven to be the most difficult. Accordingly, several objectives will be necessary
for each of the following departments.

e Department of Health and Human Services: Agree to move the Office
of Refugee Resettlement (ORR) to DHS or, alternatively, implement an
aggressive and regular effort by the Secretary of HHS to ensure that ORRis
fully pursuing presidential objectives in support of DHS.

e Department of Defense: Assist in aggressively building the border wall

system on America’s southern border. Additionally, explicitly acknowledge
and adjust personnel and priorities to participate actively in the defense

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of America’s borders, including using military personnel and hardware to
prevent illegal crossings between ports of entry and channel all cross-border
traffic to legal ports of entry.

Department of Justice: Agree to move the Executive Office for
Immigration Review and the Office of Immigration Litigation to DHS
and/or, alternatively, to treat the administrative law judges Gmmigration
judges and Board of Immigration Appeals) as national security personnel,
decertify their union, and move to increase hiring significantly to enable the
processing of more immigration cases.

Department of State: Allow DHS to lead international engagement in

the Western Hemisphere on issues of security and migration. Additionally,
quickly and aggressively address recalcitrant countries’ failure to accept
deportees by imposing stiff sanctions until deportees are in fact accepted for
return (not just promised to be taken).

Department of Housing and Urban Development: Ensure that only
USS. citizens and lawful permanent residents utilize or occupy federally
subsidized housing.

Department of Education: Deny loan access to those who are not U.S.
citizens or lawful permanent residents, and deny loan access to students at
schools that provide in-state tuition to illegal aliens.

Department of Labor: Eliminate the two (of four) lowest wage levels for
foreign workers.

Department of the Treasury: Implement all necessary regulations both to
equalize taxes between American citizens and working visa holders and to
provide DHS with all tax information of illegal aliens as expeditiously as possible.

Intelligence Community: Cooperate in the shrinking or elimination
of the I&A role in the IC while replacing it with CBP and HSI
representation to the IC.

AUTHOR’S NOTE: | had the honor of coordinating the efforts of the experts listed as contributors to this
book, nearly all of whom have spent more time inside or interacting with the Department of Homeland Security
than myself. | wrote only a small portion of the chapter and relied on the contributors’ experience and expertise
to give the chapter both its depth and policy impact. No views expressed herein should be attributed to any
single contributor.

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ENDNOTES

1. H.R. 5005, Homeland Security Act of 2002, Public Law No. 107-296, 107th Congress, November 25, 2002, $
01(b)(1), https://www.congress.gov/107/plaws/publ296/PLAW-107publ296.pdf (accessed March 14, 2023).
2. — See, for example, “Elon Musk Slams CISA Censorship Network as ‘Propaganda Platform,” Kanekoa News,
December 28, 2022, https://kanekoa.substack.com/p/elon-musk-slams-cisa-censorship-network (accessed
arch 14, 2023).
3. H.R. 2680, An Act to Amend the Immigration and Nationality Act, and for Other Purposes, Public Law No.
89-236, 89th Congress, October 3, 1965, https://www.govinfo.gov/content/pkg/STATUTE-79/pdf/STATUTE-79-
Pg91l.pdf (accessed March 14, 2023).
4. Added to the Immigration and Nationality Act by the Illegal Immigration Reform and Immigrant
Responsibility Act of 1996. See H.R. 3610, Omnibus Consolidated Appropriations Act, 1997, Public Law No.
04-208, 104th Congress, September 30, 1996, Division C, https:/Avww.congress.gov/104/plaws/pub|208/
PLAW-104publ208.pdf (accessed March 14, 2023).
5. 8US. Code, https://www.law.cornell.edu/uscode/text/8 (accessed March 14, 2023).
8 U.S. Code, https://www.law.cornell.edu/uscode/text/18 (accessed March 14, 2023).
7. 5U.S. Code §§ 551-559, https://www.law.cornell.edu/uscode/text/5/part-I/chapter-5/subchapter-ll (accessed
arch 14, 2023).
8. Table, “United States Citizenship and Immigration Services Budget Comparison and Adjustments
Appropriation and PPA Summary,” in U.S. Department of Homeland Security, United States Citizenship
and Immigration Services, Department of Homeland Security, United States Citizenship and Immigration
Services, Budget Overview, Fiscal Year 2023 Congressional Justification, p. CIS-4, https://www.uscis.gov/
sites/default/files/document/reports/U.S._Citizenship_and_Immigration_Services%E2%80%99_Budget_
Overview_Document_for%20Fiscal_ Year_2023.pdf#:~:text=The%20FY%202025%20Budget%20includes%20
%24913.6M%2C%204%2C001%20positions%3B,0f%20%24444 IM%20above%20the%20FY%202022%20
President%E2%80%99s%20Budget (accessed March 14, 2023), and Table, “United States Citizenship and
Immigration Services Comparison of Budget Authority and Request,” in ibid., p. CIS-5.
9. H.R. 7311, William Wilberforce Trafficking Victims Protection Reauthorization Act of 2008, Public Law No.
110-457, 10th Congress, December 23, 2008, § 235, httos://Awww.congress.gov/110/plaws/publ457/PLAW-
NlOpub!457.pdf (accessed March 15, 2023).
10. Matter of A-B-, Respondent, 27 |&N Dec. 316 (A.G. 2018), https://www.justice.gov/eoir/page/file/1070866/
download (accessed January 18, 2023).
11. Arizona v. United States, 567 U.S. 387 (2012), https://supreme.justia.com/cases/federal/us/567/387/ (accessed
January 18, 2023).
12. Robert T. Stafford Disaster Relief and Emergency Assistance Act [Public Law 93-288; Approved May 22, 1974]
As Amended Through PL. 117-328, Enacted December 29, 2022], https://www.govinfo.gov/content/pkg/
COMPS-2977/pdf/COMPS-2977.pdf (accessed March 15, 2023).
13. U.S. Department of Homeland Security, Federal Emergency Management Agency, Department of Homeland
Security, Federal Emergency Management Agency, Budget Overview, Fiscal Year 2023 Congressional
Justification, p. FEMA-24, https://Awww.dhs.gov/sites/default/files/2022-03/Federal%20Emergency%20
anagement%20Agency_Remediated.pdf (accessed March 15, 2023).
14. Report, United States Secret Service: An Agency in Crisis, Committee on Oversight and Government Reform,
U.S. House of Representatives, 114th Congress, December 9, 2015, https://republicans-oversight.house.gov/
wp-content/uploads/2015/12/Oversight-USSS-Report.pdf (accessed January 18, 2023).
15. 5US. Code § 7103, https://www.law.cornell.edu/uscode/text/5/7103 (accessed March 15, 2023).
16. 5S. 3418, Privacy Act of 1974, Public Law No. 93-579, 93rd Congress, December 31, 1974, https://www.govinfo.
gov/content/pkg/STATUTE-88/pdf/STATUTE-88-Pg1896.pdf (accessed March 15, 2023).
17. H.R. 1428, Judicial Redress Act of 2015, Public Law No. 114-126, 114th Congress, February 24, 2016, https://www.
congress.gov/114/plaws/publ126/PLAW-114publ126.pdf (accessed March 15, 2023).
18. H.R. 1158, Consolidated Appropriations Act, 2020, Public Law No. 116-93, 1l6th Congress, December 20, 2019,
https://Awww.congress.gov/bill/116th-congress/house-bill/1158 (accessed January 18, 2023).

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19.

20.

2025 Presidential Transition Project

U.S. Department of Homeland Security, Office of Inspector General, Management Directive No. 0810.1, June 10,
2004, https://www.dhs.gov/xlibrary/assets/foia/mamt_directive_0810_1 the_office_of inspector general.
pdf (accessed March 15, 2023).
H.R. 5005, Homeland Security Act of 2002, Public Law No. 107-296, 107th Congress, November 25, 2002,
https://Awww.congress.gov/bill/107th-congress/house-bill/5005 (accessed January 18, 2023).

— 169 —

DEPARTMENT OF STATE

Kiron K. Skinner

he U.S. Department of State’s mission is to bilaterally, multilaterally, and

regionally implement the President’s foreign policy priorities; to serve U.S.

citizens abroad; and to advance the economic, foreign policy, and national
security interests of the United States.

Since the U.S. Founding, the Department of State has been the American gov-
ernment’s designated tool of engagement with foreign governments and peoples
throughout the world. Country names, borders, leaders, technology, and people
have changed in the more than two centuries since the Founding, but the basics of
diplomacy remain the same. Although the Department has also evolved throughout
the years, at least in the modern era, there is one significant problem that the next
President must address to be successful.

There are scores of fine diplomats who serve the President’s agenda, often
helping to shape and interpret that agenda. At the same time, however, in all
Administrations, there is a tug-of-war between Presidents and bureaucracies—
and that resistance is much starker under conservative Presidents, due
largely to the fact that large swaths of the State Department’s workforce are
left-wing and predisposed to disagree with a conservative President’s policy
agenda and vision.

It should not and cannot be this way: The American people need and deserve
a diplomatic machine fully focused on the national interest as defined through
the election of a President who sets the domestic and international agenda for
the nation. The next Administration must take swift and decisive steps to reforge
the department into a lean and functional diplomatic machine that serves the

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President and, thereby, the American people. Below is the basic but essential road-
map for achieving these repairs.

HISTORY AND CONTEXT

Founded in 1789, the Department of State was one of the first Cabinet-level
agencies in the new American government. The first Secretary of State, Thomas
Jefferson, oversaw a small staff, diplomatic posts in London and Paris, and 10 con-
sular posts.' Today, the Department of State has almost 80,000 total employees
(including 13,517 foreign service employees and 11,683 civil service employees) in
275 embassies, consulates, and other posts around the world.”

In theory, the State Department is the principal agency responsible for carrying
out the President’s foreign policy and representing the United States in other nations
and international organizations. To the extent consistent with presidential policy and
federal law, the department also supports U.S. citizens and businesses in other nations
and vets foreign nationals seeking temporary or permanent entrance to the United
States. The State Department also provides humanitarian, security, and other assistance
to non-US. populations in need, and otherwise advances and supports U.S. national
interests abroad. Properly led, the State Department can be instrumental for commu-
nicating and implementing a foreign policy vision that best serves American citizens.

As the U.S. Commission on National Security/21st Century (the Hart-Rudman
Commission) observed more than 20 years ago, the State Department is a “crip-
pled institution” suffering from “an ineffective organizational structure in which
regional and functional policies do not serve integrated goals, and in which sound
management, accountability, and leadership are lacking.”* Unfortunately, this
critique remains accurate.

The State Department’s failures are not due to a lack of resources. As one
expert has observed, the department “has significantly more at its disposal than
was the case at the end of the Cold War, in the mid-1990s, and at the height of the
Iraq and Afghanistan wars.”* A major source, if not the major source, of the State
Department’s ineffectiveness lies in its institutional belief that it is an independent
institution that knows what is best for the United States, sets its own foreign policy,
and does not need direction from an elected President.

The next President can make the State Department more effective by providing
a clear foreign policy vision, selecting political officials and career diplomats that
will enthusiastically turn that vision into a policy agenda, and firmly supporting
the State Department as it makes the necessary institutional adjustments.

POLITICAL LEADERSHIP AND BUREAUCRATIC
LEADERSHIP AND SUPPORT

Focusing the State Department on the needs and goals of the next President
will require the President’s handpicked political leadership—as well as foreign

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service and civil service personnel who share the President’s vision and policy
agendas—to run the department. This can be done by taking these steps at the
outset of the next Administration.

Exert Leverage During the Confirmation Process. Notwithstanding the
challenges and slowness of the modern U.S. Senate confirmation process, the next
President can exert leverage on the Senate if he or she is willing to place State
Department appointees directly into those roles, pending confirmation. Doing so
would both ensure that the department has immediate senior political leadership
and would force the Senate to act on nominees’ appointments instead of being
allowed to engage in dilatory tactics that cripple the State Department’s function-
ality for weeks, months, or even years.

Assert Leadership in the Appointment Process. The next Administration
should assert leadership over, and guidance to, the State Department by placing
political appointees in positions that do not require Senate confirmation, including
senior advisors, Principal Deputy Assistant Secretaries, and Deputy Assistant Sec-
retaries. Given the department’s size, the next Administration should also increase
the number of political appointees to manage it.

To the extent possible, all non-confirmed senior appointees should be selected
by the President-elect’s transition team or the new President’s Office of Presiden-
tial Personnel (depending on the timing of selection) and be in place the first day
of the Administration. No one ina leadership position on the morning of January
20 should hold that position at the end of the day. These recommendations do not
imply that foreign service and civil service officials should be excluded from key
roles: It is hard to imagine a scenario in which they are not immediately relevant to
the transition of power. The main suggestion here is that as many political appoin-
tees as possible should be in place at the start of anew Administration.

Support and Train Political Appointees. The Secretary of State should use
his or her office and its resources to ensure regular coordination among all political
appointees, which should take the form of strategy meetings, trainings, and other
events. The secretary should also take reasonable steps to ensure that the State
Department’s political appointees are connected to other departments’ political
appointees, which is critical for cross-agency effectiveness and morale. The sec-
retary should capitalize on the more experienced political appointees by using
them as the foundation for a mentorship program for less experienced political
appointees. The interaction of political appointees must be routine and operational
rather than incidental or occasional, and it must be treated as a crucial dimension
for the next Administration’s success.

Maximize the Value of Career Officials. Career foreign service and civil
service personnel can and must be leveraged for their expertise and commit-
ment to the President’s mission. Indeed, the State Department has thousands of
employees with unparalleled linguistic, cultural, policy, and administrative skills,

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and large numbers of them have been an enormous resource to the Secretaries of
State under which they have served. The secretary must find a way to make clear
to career officials that despite prior history and modes of operation, they need
not be adversaries of a conservative President, Secretary of State, or the team of
political appointees.

Reboot Ambassadors Worldwide. All ambassadors are required to submit
letters of resignation at the start of anew Administration. Previous Republican
Administrations have accepted the resignations of only the political ambassadors
and allowed the foreign service ambassadors to retain their posts, sometimes for
months or years into a new Administration.® The next Administration must go
further: It should both accept the resignations of all political ambassadors and
quickly review and reassess all career ambassadors. This review should commence
well before the new Administration’s first day.

Ambassadors in countries where U.S. policy or posture would substantially
change under the new Administration, as well as any who have evinced hostility
toward the incoming Administration or its agenda, should be recalled immediately.
The priority should be to put in place new ambassadors who support the Presi-
dent’s agenda among political appointees, foreign service officers, and civil service
personnel, with no predetermined percentage among these categories. Political
ambassadors with strong personal relationships with the President should be pri-
oritized for key strategic posts such as Australia, Japan, the United Kingdom, the
United Nations, and the North Atlantic Treaty Organization (NATO).

RIGHTING THE SHIP

Ensuring the State Department is accountable for serving American citi-
zens first will require—at a minimum—that the following steps be implemented
immediately:

Review Retroactively. Before inauguration, the President-elect’s department
transition team should assess every aspect of State Department negotiations and
funding commitments. Upon inauguration, the Secretary of State should order an
immediate freeze on all efforts to implement unratified treaties and international
agreements, allocation of resources, foreign assistance disbursements, domestic
and international contracts and payments, hiring and recruiting decisions, etc.,
pending a political appointee-driven review to ensure that such efforts comport
with the new Administration’s policies. The quality of this review is more import-
ant than speed. The posture of the department during this review should be an
unwavering desire to prioritize the American people—including a recognition that
the federal government must be a diligent steward of taxpayer dollars.

Implement Repair. The State Department must change its handling of
international agreements to restore constitutional governance. Under prior
Administrations, unnecessary institutional factors in the department caused

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numerous logistical challenges in negotiating, approving, and implementing trea-
ties and agreements. This is particularly true under the Biden Administration. For

example, under the Biden Administration, the State Department was considered

sufficiently unreliable in terms of alignment and effectiveness such that its political

leadership invoked its Circular 175 (C-175) authority to delegate its diplomatic

capacity to other agencies such as the Department of Homeland Security.

At time of publication, the State Department is negotiating (or seeking to nego-
tiate) large-scale, sovereignty-eroding agreements that could come at considerable
economic and other costs to the American people. Although such agreements
should be evaluated and approved as are treaties, the Biden Administration is
likely to simply call them “agreements.” The Biden State Department not only
approves but also enforces treaties that have not been ratified by the U.S. Senate.
This practice must be thoroughly reviewed—and most likely jettisoned.

The next President should recalibrate how the State Department handles trea-
ties and agreements, primarily by restoring constitutionality to these processes.
He or she should direct the Secretary of State to freeze any ongoing treaty or inter-
national agreement negotiations and assess whether those efforts align with the
new President’s foreign policy direction. The next Administration should also
direct the secretary to order an immediate stand-down on enforcement of any
treaties that have not been ratified by the Senate, and order a thorough review of
the degree to which such enforcement has impacted the department’s functions,
policies, and use of resources.

The Secretary of State, in cooperation with the Office of the Attorney General
and the White House Counsel’s Office, should also conduct a review to identify
“agreements” that are really treaty commitments within the ordinary public mean-
ing of the Constitution,°® and suspend compliance pending presidential transmittal
of those agreements to the Senate for advice and consent. The next Administration
should also move to withdraw from treaties that have been under Senate consider-
ation for 20 years or more, with the understanding that those treaties are unlikely
to be ratified. Under circumstances in which ratification of a stale treaty before
the Senate still serves national interests, the treaty letter of transmittal and sub-
mission should be updated for current circumstances. The Secretary of State must
revoke most outstanding C-175 authorities that have been granted to other agen-
cies during previous Administrations, although such revocations should be closely

coordinated with the White House for logistical reasons.

Coordinate with Other Agencies. Interagency engagement in this new
environment must be similarly adjusted to mirror presidential direction. Indeed,
coordination among federal agencies is challenging even in the most well-oiled
Administrations. Although such coordination is inescapable and sometimes produc-
tive, agencies tend to leverage each other’s resources in ways that occasionally have
off-mission consequences for the agency or agencies with the resources. Ideally, the

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Secretary of State should work as part of an agile foreign policy team along with the
National Security Advisor, the Secretary of Defense, and other agency heads to flesh
out and advance the President’s foreign policy. Bureaucratic stovepipes of the past
should be less important than commitment to, and achievement of, the President’s
foreign policy agenda. The State Department’s role in these interagency discussions
must reflect the President’s clear direction and disallow resources and tools to be
used in any way that detracts from the presidentially directed mission.

Coordinate with Congress. Congress has both the statutory and appropri-
ations authority to impact the State Department’s operations and has a strong
interest in key aspects of American foreign policy. The department must therefore
take particular care in its interaction with Congress, since poor interactions with
Congress, regardless of intentions, could trigger congressional pushback or have
other negative impacts on the President’s agenda.

This will require particularly strong leadership of the Department of State’s
Bureau of Legislative Affairs. The Secretary of State and political leadership should
ensure full coordination with the White House regarding congressional engage-
ment on any State Department responsibility. This may lead to, for example, the
President authorizing the State Department to engage with Members of Congress
and relevant committees on certain issues (including statutorily designated con-
gressional consultations), but to remain “radio silent” on volatile or designated
issues on which the White House wants to be the primary or only voice. All such
authorized department engagements with Congress must be driven and handled
by political appointees in conjunction with career officials who have the relevant
expertise and are willing to work in concert with the President’s political appoin-
tees on particularly sensitive matters.

Respond Vigorously to the Chinese Threat. The State Department recently
opened the Office of China Coordination, or “China House.” This office is intended
to bring together experts inside and outside the State Department to coordinate
U.S. government relations with China “and advance our vision for an open, inclu-
sive international system.”” Whether China House will streamline U.S. government
communication, consensus, and action on China policy—given the presence of
other agencies with strong competing or adverse interests—remains to be seen.
The unit is dependent on adequate and competent staff being assigned by other
bureaus within the State Department.

Nonetheless, the concept is one a Republican Administration should support
mutatis mutandis. The Chinese Communist Party (CCP) has been “at war” with
the U.S. for decades. Now that this reality has been accepted throughout the gov-
ernment, the State Department must be prepared to lead the U.S. diplomatic effort
accordingly. The centralization of efforts in one place is critical to this end.

Review Immigration and Domestic Security Requirements. Arguably, the
department’s most noteworthy challenge on the global stage has been its handling

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of immigration and domestic security issues, which are inextricably related. The
State Department’s apparent posture toward these two issues, which are of para-
mount importance to the American people, has historically been that they are of
lesser importance than other issues and that they can be treated as concessions in
broader diplomatic engagements. In other instances in which access to the U.S. in
the form of immigrant (permanent) and nonimmigrant (temporary) visas could
potentially serve as diplomatic leverage, it is almost never used. To some degree,
the State Department and many of its personnel appear to view the U.S. immigra-
tion system less as a tool for strengthening the United States and more as a global
welfare program.

To ensure the safety, security, and prosperity of all Americans, this must change.
Below are several key areas in which the department’s formal and informal postures
must adjust to reflect the current immigration and domestic security environment:

e Visa reciprocity. The United States should strictly enforce the doctrine
of reciprocity when issuing visas to all foreign nationals. For too long, the
USS. has provided virtually unfettered access to foreign nationals from
countries that do not respond in kind—including countries that are actively
hostile to U.S. interests and nationals. Mandatory reciprocity will convey
the necessary reality that other countries do not have an unfettered right
to U.S. access and must reciprocally offer favorable visa-based access to U.S.
nationals. The State Department's reaction time to other countries’ changes
in visa policies with respect to the U.S. must be streamlined to ensure it can
be updated in real time.

e Section 243(d) visa sanctions. Visa sanctions under section 243(d) of
the Immigration and Nationality Act (NA),* enacted into law to motivate
countries to accept the return of any nationals who have been ordered
removed from the U.S., should be quickly and fully enforced. Recalcitrant
countries that do not accept receipt of their returned nationals will risk the
suspension of issuance of allimmigrant visas, all nonimmigrant visas, or
all visas. These country-specific sanctions should remain in place until the
sanctioned country accepts the return of all its removal-pending nationals
and formally commits to future, regular acceptance of its nationals. Black-
letter implementation of this law will demonstrate a heretofore lacking
seriousness to the international community that other nations must respect
U.S. immigration laws and work with federal authorities to accept returning
nationals—or lose access to the United States.

e Rightsizing refugee admissions. The Biden Administration has
engineered what is nothing short of a collapse of U.S. border security and

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interior immigration enforcement. This Administration’s humanitarian
crisis—which is arguably the greatest humanitarian crisis in the modern
era, one which has harmed Americans and foreign nationals alike—will

take many years and billions of dollars to fully address. One casualty of the
Biden Administration’s behavior will be the current form of the U.S. Refugee
Admission Program (USRAP).

The federal government’s obligation to shift national security—essential
screening and vetting resources to the forged border crisis will necessitate
an indefinite curtailment of the number of USRAP refugee admissions. The
State Department’s Bureau of Population, Refugees, and Migration, which
administers USRAP, must shift its resources to challenges stemming from
the current immigration situation until the crisis can be contained and
refugee-focused screening and vetting capacity can reasonably be restored.

e Strengthening bilateral and multilateral immigration-focused
agreements. Restoration of both domestic security and the integrity of
the U.S. immigration system should start with rapid reactivation of several
key initiatives in effect at the conclusion of the Trump Administration.
Reimplementation of the Remain in Mexico policy, safe third-country
agreements, and other measures to address the influx of non-Mexican
asylum applicants at the United States-Mexico border must be Day
One priorities. Although the State Department must rein in the C-175
authorities of other agencies, the Department of Homeland Security should
retain (or regain) C-175 authorities for negotiating bilateral and multilateral
security agreements.

e Evaluation of national security-vulnerable visa programs. To protect
the American people, the State Department, in coordination with the White
House and other security-focused agencies, should evaluate several key
security-sensitive visa programs that it manages. Key programs include, but
should not be limited to, the Diversity Visa program, the F (student) visa
program, and J (exchange visitor) visa program. The State Department’s
evaluation must ensure that these programs are not only consistent with
White House immigration policy, but also align with its national security
obligations and resource limitations.

PIVOTING ABROAD

Personnel and management adjustments are crucial preludes to refocus the
State Department’s mission, which is implementing the President’s foreign policy
agenda and, in so doing, ensuring that the interests of American citizens are given

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priority. That said, the next President must significantly reorient the U.S. govern-
ment’s posture toward friends and adversaries alike—which will include much

more honest assessments about who are friends and who are not. This reorien-
tation could represent the most significant shift in core foreign policy principles

and corresponding action since the end of the Cold War.

Although not every country or issue area can be discussed in this chapter, below
are examples of several areas in which a shift in U.S. foreign policy is not only import-
ant, but arguably existential. The point is not to assert that everyone in the evolving
conservative movement, or, in some cases, the growing bipartisan consensus, will
agree with the details of this assessment. Rather, what is presented below demon-
strates the urgency of these issues and provides a general roadmap for analysis.

Ina world on fire, a handful of nations require heightened attention. Some rep-
resent existential threats to the safety and security of the American people; others
threaten to hurt the U.S. economy; and others are wild cards, whose full threat
scope is unknown but nevertheless unsettling. The five countries on which the next
Administration should focus its attention and energy are China, Iran, Venezuela,
Russia, and North Korea.

The People’s Republic of China

The designs of the People’s Republic of China (PRC) and the Chinese Com-
munist Party, which runs the PRC, are serious and dangerous.’ This tyrannical
country with a population of more than 1 billion people has the vision, resources,
and patience to achieve its objectives. Protecting the United States from the PRC’s
designs requires an unambiguous offensive-defensive mix, including protecting
American citizens and their interests, as well as US. allies, from PRC attacks and
abuse that undermine U.S. competitiveness, security, and prosperity.

The United States must have a cost-imposing strategic response to make Bei-
jing’s aggression unaffordable, even as the American economy and U.S. power grow.
This stance will require real, sustained, near-unprecedented U.S. growth; stronger
partnerships; synchronized economic and security policies; and American energy
independence—but above all, it will require a very honest perspective about the
nature and designs of the PRC as more of a threat than a competitor.’° The next
President should use the State Department and its array of resources to reassess
and lead this effort, just as it did during the Cold War. The U.S. government needs
an Article X for China," and it should be a presidential mandate. Along with the
National Security Council, the State Department should draft an Article X, which
should be a deeply philosophical look at the China challenge.

Many foreign policy professionals and national leaders, both in government and
the private sector, are reluctant to take decisive action regarding China. Many are
vested in an unshakable faith in the international system and global norms. They
are so enamored with them they cannot brook any criticisms or reforms, let alone

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acknowledge their potential for being abused by the PRC. Others refuse to acknowl-
edge Beijing’s malign activities and often pass off criticism as conspiracy theories.

For instance, many were quick to dismiss even the possibility that COVID-19
escaped from a Chinese research laboratory. The reality, however, is that the PRC’s
actions often do sound like conspiracy theories—because they are conspiracies. In
addition, some knowingly or not parrot the Communist line: Global leaders includ-
ing President Joe Biden, have tried to normalize or even laud Chinese behavior.
In some cases, these voices, like the global corporate giants BlackRock and Disney,
directly benefit from doing business with Beijing.

On the other hand, others acknowledge the dangers posed by the PRC, but
believe in a moderating approach to accommodate its rise, a policy of “compete
where we must, but cooperate where we can,” including on issues like climate
change. This strategy has demonstrably failed.

As with all global struggles with Communist and other tyrannical regimes, the
issue should never be with the Chinese people but with the Communist dictator-
ship that oppresses them and threatens the well-being of nations across the globe.”
That said, the nature of Chinese power today is the product of history, ideology,
and the institutions that have governed China during the course of five millennia,
inherited by the present Chinese leaders from the preceding generations of the
CCP." In short, the PRC challenge is rooted in China’s strategic culture and not
just the Marxism-Leninism of the CCP, meaning that internal culture and civil
society will never deliver a more normative nation. The PRC’s aggressive behavior
can only be curbed through external pressure.

The Islamic Republic of Iran

The ongoing protests in the Islamic Republic of Iran (Iran), which are widely
viewed as a new revolution, have shown that the Islamic regime, which has been
in power since 1979 when Ayatollah Khomeini became the leader, is at its weakest
state in its history and is at odds not only with its own people but also its regional
neighbors. Iran is home to a proud and ancient culture, yet its people have strug-
gled to achieve democracy and have had to endure a hostile theocratic regime that
vehemently opposes freedom. The time may be right to press harder on the Iranian
theocracy, support the Iranian people, and take other steps to draw Iran into the
community of free and modern nations.

Unfortunately, the Obama and Biden Administrations have propped up the
brutal Islamist theocracy that has hurt the Iranian people and threatened nuclear
war. For example, the Obama Administration’s 2015 Joint Comprehensive Plan of
Action, commonly referred to as the Iran nuclear deal, gave the Islamic regime a
crucial monetary lifeline after the Green Movement protests in 2009, which, while
ultimately unsuccessful, did succeed in weakening the regime and showing the
world that younger Iranians want freedom.

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Instead of pressuring the Iranian theocracy to move toward democracy, the
Obama Administration threw the brutal regime an economic lifeline by giving
hundreds of billions of dollars to the Iranian government and providing other sanc-
tions relief. This economic relief did not moderate the regime, but emboldened its
brutality, its efforts to expand its nuclear weapons programs, and its support for
global terrorism. Former President Obama has admitted his lack of support for the
Green Movement during his Administration was an error and blamed it on poor
advisors—yet those same advisors are involved with the Biden Administration’s
insistence on reducing pressure on the theocracy and resurrecting a nuclear deal.

The next Administration should neither preserve nor repeat the mistakes of
the Obama and Biden Administrations. The correct future policy for Iran is one
that acknowledges that it is in U.S. national security interests, the Iranian people’s
human rights interests, and a broader global interest in peace and stability for the
Iranian people to have the democratic government they demand. This decision
to be free of the country’s abusive leaders must of course be made by the Iranian
people, but the United States can utilize its own and others’ economic and diplo-
matic tools to ease the path toward a free Iran and a renewed relationship with
the Iranian people.

The Bolivarian Republic of Venezuela

Once a model of democracy and a true U.S. ally, the Bolivarian Republic of Ven-
ezuela (Venezuela) has all but collapsed under the Communist regimes of the late
Hugo Chavez and Nicolas Maduro. In the 24 years since Hugo Chavez was first
elected Venezuelan president in 1999, the country has violently cracked down on
pro-democracy citizens and organizations, shattered its once oil-rich economy,
empowered domestic criminal cartels, and helped fuel a hemispheric refugee crisis.

Venezuela has swung from being one of the most prosperous, if not the most
prosperous, country in South America to being one of the poorest. Its Communist
leadership has also drawn closer to some of the United States’ greatest interna-
tional foes, including the PRC and Iran, which have long sought a foothold in the
Americas. Indeed, Venezuela serves as a reminder of just how fragile democratic
institutions that are not maintained can be. To contain Venezuela’s Communism
and aid international partners, the next Administration must take important steps
to put Venezuela’s Communist abusers on notice while making strides to help the
Venezuelan people. The next Administration must work to unite the hemisphere
against this significant but underestimated threat in the Southern Hemisphere.

Russia

One issue today that starkly divides conservatives is the Russia—Ukraine con-
flict. The common ground seems to be recognition that presidential leadership
in 2025 must chart the course.

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e One school of conservative thought holds that as Moscow’s illegal war of
aggression against Ukraine drags on, Russia presents major challenges to
US. interests, as well as to peace, stability, and the post-Cold War security
order in Europe. This viewpoint argues for continued U.S. involvement
including military aid, economic aid, and the presence of NATO and U.S.
troops if necessary. The end goal of the conflict must be the defeat of
Russian President Vladimir Putin and a return to pre-invasion border lines.

e Another school of conservative thought denies that U.S. Ukrainian support
is in the national security interest of America at all. Ukraine is not amember
of the NATO alliance and is one of the most corrupt nations in the region.
European nations directly affected by the conflict should aid in the defense
of Ukraine, but the U.S. should not continue its involvement. This viewpoint
desires a swift end to the conflict through a negotiated settlement between
Ukraine and Russia.

e The tension between these competing positions has given rise to a third
approach. This conservative viewpoint eschews both isolationism and
interventionism. Rather, each foreign policy decision must first ask the
question: What is in the interest of the American people? U.S. military
engagement must clearly fall within U.S. interests; be fiscally responsible;
and protect American freedom, liberty, and sovereignty, all while recognizing
Communist China as the greatest threat to US. interests. Thus, with respect to
Ukraine, continued U.S. involvement must be fully paid for; limited to military
aid (while European allies address Ukraine’s economic needs); and have a
clearly defined national security strategy that does not risk American lives.

Regardless of viewpoints, all sides agree that Putin’s invasion of Ukraine
is unjust and that the Ukrainian people have a right to defend their homeland.
Furthermore, the conflict has severely weakened Putin’s military strength and
provided a boost to NATO unity and its importance to European nations.

The next conservative President has a generational opportunity to bring res-
olution to the foreign policy tensions within the movement and chart a new path
forward that recognizes Communist China as the defining threat to U.S. interests
in the 21st century.

The Democratic People’s Republic of Korea

Peace and stability in Northeast Asia are vital interests of the United States. The
Republic of Korea (South Korea) and Japan are critical allies for ensuring a free
and open Indo-Pacific. They are indispensable military, economic, diplomatic, and
technology partners. The Democratic People’s Republic of Korea (DPRK, or North

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Korea) must be deterred from military conflict. The United States cannot permit

the DPRK to remain a de facto nuclear power with the capacity to threaten the

United States or its allies. This interest is both critical to the defense of the Amer-
ican homeland and the future of global nonproliferation. The DPRK must not be

permitted to profit from its blatant violations of international commitments or to

threaten other nations with nuclear blackmail. Both interests can only be served

if the U.S. disallows the DPRK’s rogue regime behavior.

OTHER INTERNATIONAL ENGAGEMENTS

Western Hemisphere

The United States has a vested interest in a relatively united and economically
prosperous Western Hemisphere. Nonetheless, the region now has an overwhelm-
ing number of socialist or progressive regimes, which are at odds with the freedom
and growth-oriented policies of the U.S. and other neighbors and who increasingly
pose hemispheric security threats. A new approach is therefore needed, one that
simultaneously allows the U.S. to re-posture in its best interests and helps regional
partners enter a new century of growth and opportunity.

The following core policies must be part of this new direction:

e A“sovereign Mexico” policy. Mexico is currently a national security
disaster. Bluntly stated, Mexico can no longer qualify as a first-world nation;
it has functionally lost its sovereignty to muscular criminal cartels that
effectively run the country. The current dynamic is not good for either
USS. citizens or Mexicans, and the perfect storm created by this cartel state
has negative effects that are damaging the entire hemisphere. The next
Administration must both adopt a posture that calls for a fully sovereign
Mexico and take all steps at its disposal to support that result in as rapid a
fashion as possible.

e A fentanyl-free frontier. The same cartels that parasitically run Mexico
are also working with the PRC to fuel the largest drug crisis in the history
of North America. These Mexican cartels are working closely with Chinese
fentanyl precursor chemical manufacturers, importing those precursor
chemicals into Mexico, manufacturing fentanyl on Mexican soil, and
shipping it into the United States and elsewhere. The highly potent narcotic
is having an unprecedented lethal impact on the American citizenry. The
next Administration must leverage its new insistence on a sovereign Mexico
and work with other Western Hemisphere partners to halt the fentanyl
crisis and put a decisive end to this unprecedented public health threat.

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A hemisphere-centered approach to industry and energy. The
next Administration has a golden opportunity to make key economic
changes that will not only provide tremendous economic opportunities
for Americans but will also serve as an economic boon to the entire
Western Hemisphere.

First, the United States must do everything possible, with both resources
and messaging, to shift global manufacturing and industry from more
distant points around the globe (especially from the increasingly hostile
and human rights-abusing PRC) to Central and South American countries.
“Re-hemisphering” manufacturing and industry closer to home will not only
eliminate some of the more recent supply-chain issues that damaged the US.
economy but will also represent a significant economic improvement for
parts of the Americas in need of growth and stabilization.

Similarly, the United States must work with Mexico, Canada, and other
countries to develop a hemisphere-focused energy policy that will reduce
reliance on distant and manipulable sources of fossil fuels, restore the free
flow of energy among the hemisphere’s largest producers, and work together
to increase energy production, including for nations that are looking for
dramatic economic expansion.

A “local” approach to security threats. Western Hemisphere nations,
including those in the Caribbean, arguably have stronger cultural and
historical ties to the United States than most other countries and regions
in the world. Yet Central and South America are moving rapidly into the
sphere of anti-American, external state actors, including the PRC, Iran, and
Russia. Specific countries in the Americas, such as Venezuela, Colombia,
Guyana, and Ecuador, are either increasingly regional security threats

in their own rights or are vulnerable to hostile extra-continental powers.
The U.S. has an opportunity to lead these democratic neighbors to fight
against the external pressure of threats from abroad and address local
regional security concerns. This leadership and collaboration must span all
tools at the disposal of U.S. allies and partners, including security-focused
cooperation.

Middle East and North Africa

The next Administration must re-engage with Middle Eastern and North Afri-

can nations and not abandon the region. Without U.S. leadership, the region may
tumble further into chaos or fall prey to American adversaries. This recommen-

dation requires a multi-dimensional strategy.

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First, the U.S. must prevent Iran from acquiring nuclear technology and
delivery capabilities and more broadly block Iranian ambitions. This means,
inter alia, reinstituting and expanding Trump Administration sanctions;
providing security assistance for regional partners; supporting, through
public diplomacy and otherwise, freedom-seeking Iranian people in

their revolt against the mullahs; and ensuring Israel has both the military
means and the political support and flexibility to take what it deems to be
appropriate measures to defend itself against the Iranian regime and its
regional proxies Hamas, Hezbollah, and Palestinian Islamic Jihad.

Second, the next Administration should build on the Trump
Administration’s diplomatic successes by encouraging other Arab states,
including Saudi Arabia, to enter the Abraham Accords. Related policies
should include reversing, as appropriate, the Biden Administration’s
degradation of the long-standing partnership with Saudi Arabia. The
Palestinian Authority should be defunded. A further key priority is keeping
Tiirkiye in the Western fold and a NATO ally. This includes a vigorous
outreach to Tiirkiye to dissuade it from “hedging” toward Russia or China,
which is likely to require a rethinking of U.S. support for YPG/PKK [People’s
Protection Units/Kurdistan Worker’s Party] Kurdish forces, which Ankara
believes are an existential threat to its security. For the foreseeable future—
and much longer than one new Administration— Middle Eastern oil will
play a key role in the world economy. Therefore, the U.S. must continue

to support its allies and compete with its economic adversaries, including
China. Relations with Saudi Arabia should be strengthened in a way that
seriously curtails Chinese influence in Riyadh.

Third, it is in the U.S. national interest to build a Middle East security

pact that includes Israel, Egypt, the Gulf states, and potentially India, asa
second “Quad” arrangement. Protecting freedom of navigation in the Gulf
and in the Red Sea/Suez Canal is vital to the world economy and therefore
to US. prosperity as well. In North Africa, security cooperation with
European allies, especially France, will be vital to limit growing Islamist
threats and the incursion of Russian influence through positionings of the
Wagner Group.

The U.S. cannot neglect a concern for human rights and minority rights,
which must be balanced with strategic and security considerations. Special
attention must be paid to challenges of religious freedom, especially the
status of Middle Eastern Christians and other religious minorities, as well as
the human trafficking endemic to the region.

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Sub-Saharan Africa

Africa’s importance to U.S. foreign policy and strategic interests is rising and
will only continue to grow. Its explosive population growth, large reserves of
industry-dependent minerals, proximity to key maritime shipping routes, and its
collective diplomatic power ensure the continent’s global importance. Yet as Afri-
ca’s strategic significance has grown, the U.S.’s relative influence there has declined.
Terrorist activity on the continent has increased, while America’s competitors are
making significant gains for their own national interests. The PRC’s companies
dominate the African supply chain for certain minerals critical to emerging tech-
nologies. African nations comprise major country-bloc elements that shield the
PRC and Russia from international isolation for their human rights abuses—and
African nations staunchly support PRC foreign policy goals on issues such as Hong
Kong occupation, South China Seas dispute arbitration, and Taiwan.

The new Administration can correct this strategic failing of existing policy by
prioritizing Africa and by undertaking fundamental changes in how the United
States works with African nations.

At a bare minimum, the next Administration should:

e Shift strategic focus from assistance to growth. Reorient the focus of
U.S. overseas development assistance away from stand-alone humanitarian
development aid and toward fostering free market systems in African
countries by incentivizing and facilitating US. private sector engagement
in these countries. Development aid alone does little to develop countries
and can fuel corruption and violent conflict. While the United States should
always be willing to offer emergency and humanitarian relief, both U.S. and
African long-term interests are better served by a free market-based, private
growth-focused strategy to Africa’s economic challenges.

e Counter malign Chinese activity on the continent. This should include
the development of powerful public diplomacy efforts to counter Chinese
influence campaigns with commitments to freedom of speech and the free
flow of information; the creation of a template “digital hygiene” program
that African countries can access to sanitize and protect their sensitive
communications networks from espionage by the PRC and other hostile
actors; the recognition of Somaliland statehood as a hedge against the U.S_’s
deteriorating position in Djibouti; and a focus on supporting American
companies involved in industries important to U.S. national interests or that
have a competitive advantage in Africa.

e Counter the furtherance of terrorism. African country-based terrorist
groups like Boko Haram may currently lack the capability to attack the

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United States, but at least some of them would eventually try if allowed to
consolidate their operations and plan such attacks. The immediate threat
they pose lies in their abilities and willingness to strike American targets in
their regions of operation or to harm U.S. interests in other ways. The U.S.
should support capable African military and security operations through
the State Department and other federal agencies responsible for granting
foreign military education, training, and security assistance.

e Build a coalition of the cooperative. Rather than thinning limited federal
resources by spreading funds across all countries (including some that are
unsupportive or even hostile to the United States,) the next Administration
should focus on those countries with which the U.S. can expect a mutually
beneficial relationship. After being designated focus countries by the
State Department, such nations should receive a full suite of American
engagement. That said, the next Administration should still maintain a
baseline level of contact even with those countries with which it has less-
than-fruitful relationships in order to encourage positive developments and
to be in position to seize unexpected diplomatic opportunities as they arise.

e Focus on core diplomatic activities, and stop promoting policies
birthed in the American culture wars. African nations are particularly
(and reasonably) non-receptive to the U.S. social policies such as abortion
and pro-LGBT initiatives being imposed on them. The United States should
focus on core security, economic, and human rights engagement with
African partners and reject the promotion of divisive policies that hurt the
deepening of shared goals between the U.S. and its African partners.

Europe

American foreign policy has long benefited from cooperation with the countries
of Europe (generally, the EU), and any conservative Administration should build
on this resource. Yet the transatlantic relationship is complex, with security, trade,
and political dimensions.

First, the Europe, Eurasia, and Russia region is made up of relatively wealthy
and technologically advanced societies that should be expected to bear a fair share
of both security needs and global security architecture: The United States cannot
be expected to provide a defense umbrella for countries unwilling to contribute
appropriately. At stake after 2024 will be examining the status of the Wales Pledge
of 2 percent of gross domestic product toward defense by NATO members. The
new Administration will also want to encourage nations to exceed that pledge.

Second, transatlantic trade is a significant part of the global economy, and it is
in the US. national interest to amplify it, especially because this means weaning

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Europe of its dependence on China. However, there are also transatlantic trade
tensions that disturb the U.S.-EU relationship and that have been evident across
Administrations. The U.S. must undertake a comprehensive review of trade
arrangements between the EU and the United States to assure that U.S. businesses
are treated fairly and to build productive reciprocity. Outside the EU, trade with
the post-Brexit U.K. needs urgent development before London slips back into the
orbit of the EU.

Third, in the wake of Brexit, EU foreign policy now takes place without U.K.
input, which disadvantages the United States, given that the U.K. has historically
been aligned with many U.S. positions. Therefore, U.S. diplomacy must be more
attentive to inner-EU developments, while also developing new allies inside the
EU—especially the Central European countries on the eastern flank of the EU,
which are most vulnerable to Russian aggression.

South and Central Asia

Many key American interests and responsibilities are found in South and
Central Asia. Specifically, continuing to advance the bilateral relationship with
India to mutual benefit is a crucial objective for U.S. policy. India plays a crucial
role in countering the Chinese threat and securing a free and open Indo-Pacific.
It is a critical security guarantor for the key routes of air and sea travel linking
East and West and an important emerging U.S. economic partner. For instance,
the 2019 Department of Defense Indo-Pacific Strategy Report noted that the
Indian Ocean area “is at the nexus of global trade and commerce, with nearly
half of the world’s 90,000 commercial vessels and two thirds of global oil trade
traveling through its sea lanes. The region boasts some of the fastest-growing
economies on Earth.”*

Meanwhile, the threat of transnational terrorism remains acute. The humiliat-
ing withdrawal of U.S. troops from Afghanistan after a 20-year military campaign
has created new challenges. It has provided an opportunity to reset the deeply
troubled U.S.-Pakistan relationship and reassess U.S. counterterrorism strategy
in the region. The long-standing India-Pakistan rivalry and tensions regarding the
disputed territory of Kashmir continue to pose risks to regional stability, especially
because both countries are nuclear powers.

The State Department’s role in strengthening the regional security and eco-
nomic framework linking the U.S and India is crucial. In addition, the department
has important functional responsibilities in dealing with a range of threats from
nuclear proliferation to transnational proliferation. While American statecraft
should also seek to improve bilateral relations throughout the region, U.S. policy
must be clear-eyed and realistic about the perfidiousness of the Taliban regime in
Afghanistan and the military—political rule in Pakistan. There can be no expecta-
tion of normal relations with either.

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The priority for statecraft is advancing the U.S.-Indian role as a cornerstone
of the Quad, a cooperative framework including the U.S., India, Japan, and Aus-
tralia. The Quad is comprised of the key nations in coordinating efforts for a free
and open Indo-Pacific. It is an overarching group that nests the key U.S. bilateral
and trilateral cooperative efforts that facilitate U.S. collaborative efforts across
the Indo-Pacific. The State Department should also encourage the “Quad-Plus”
concept that allows other regional powers to participate in Quad coordination on
issues of mutual interest. Further, the State Department must support an inte-
grated federal effort to deliver a revamped regional strategy for South Asia, as well
as leading the execution of key tasks to implement the strategy.

The Arctic

Because of Alaska, the U.S. is an Arctic nation. The Arctic is a vast expanse of
land and sea rich in resources including fish, minerals, and energy. For example,
the region is estimated to contain 90 million barrels of oil and one-quarter of the
world’s undiscovered natural gas reserves.'® The Arctic is lightly populated: Only
4 million people in the world live above the Arctic Circle, with more than half of
those living in Russia. Only around 68,000 people in Alaska live above the Arctic
Circle.” However, the sheer immensity of the Alaskan Arctic means its population
density is less than one person per square mile.’®

The United States has several strong interests in the Arctic region. The rate of
melting ice during summer months has led to increased interest not only from
shipping and tourism sectors, but also from America’s global competitors, who
are interested in exploiting the region’s strategic importance and accessing its
bounty of natural resources.

In the not-too-distant future, there will be a growing interest in the Arctic from
both state and non-state actors alike. China has been open about its interest in
the region, primarily as a highway for trade but also for its rich natural resources.
While the PRC’s increasing intervention in Arctic affairs is a bit strained because
it does not have an Arctic coastline, Russia does—and Russia has made no secret
of its view that the Arctic is vital for economic and military reasons. Russia has
invested heavily in new and refurbished Arctic bases and cold-weather equipment
and capabilities. The north star of U.S. Arctic policy should remain national sov-
ereignty, safeguarded through robust capabilities as well as through diplomatic,
economic, and legal attentiveness.

The next Administration should embrace the view that NATO must acknowl-
edge that it is, in part, an Arctic alliance. With the likely accession of Finland and
Sweden to NATO, every Arctic nation except for Russia will be a NATO member
state. NATO has been slow to appreciate that the Arctic is a theater that it must
defend, especially considering Russia’s brazen aggression against Ukraine. NATO
must develop and implement an Arctic strategy that recognizes the importance of

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the region and ensures that Russian use of Arctic waters and resources does not
exceed a reasonable footprint.

The US. should unapologetically pursue American interests in the Arctic by
promoting economic freedom in the region. Economic freedom spurs prosperity,
innovation, respect for the rule of law, jobs, and sustainability. Most important,
economic freedom can help to keep the Arctic stable and secure.

The U.S. should work to ensure that shipping lanes in the Arctic remain avail-
able to all global commercial traffic and free of onerous fees and burdensome
administrative, regulatory, and military requirements. While this should be the
next Administration’s policy with respect to all countries that might seek to block
free-flowing commercial traffic, the next Administration will clearly have to exert
substantial attention toward Russia.

Both the U.S. Coast Guard and the U.S. Navy are vital tools to ensure an unmo-
nopolized Arctic. It is imperative that the Navy and Coast Guard continue to
expand their fleets, including planned icebreaker acquisitions, to assure Arctic
access for the United States and other friendly actors. The remote and harsh con-
ditions of the Arctic also make unmanned system investment and use particularly
appealing for providing additional situational awareness, intelligence, surveillance,
and reconnaissance. The Coast Guard should also consider upgrading facilities,
such as its Barrow station, to reinforce its Arctic capabilities and demonstrate a
greater commitment to the region.

The People’s Republic of China has declared itself a “near-Arctic state,” which
is an imaginary term non-existent in international discourse. The United States
should work with like-minded Arctic nations, including Russia, to raise legitimate
concerns about the PRC’s so-called Polar Silk-Road ambitions.

Concerning Greenland, the opening of a U.S. consulate in Nuuk is welcome. A
formal year-round diplomatic presence is an effective way for the U.S. to better
understand local political and economic dynamics. Furthermore, given Green-
land’s geographic proximity and its rising potential as a commercial and tourist
location, the next Administration should pursue policies that enhance economic
ties between the U.S. and Greenland.

INTERNATIONAL ORGANIZATIONS

Defending and protecting the American people and advancing their interests
requires the United States to engage in a broad spectrum of bilateral and multilateral
relationships, including participating in international organizations. Working with
other governments through international organizations like the United Nations
(U.N.) can be tremendously useful—but membership in these organizations must
always be understood as a means to attain defined goals rather than an end in itself.

Engagement with international organizations is one relatively easy way for the
U.S. to defend its interests and to seek to address problems in concert with other

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nations, but it is not the only option—and American diplomats should be clear-
eyed about international organizations’ strengths and weaknesses. When such
institutions act against U.S. interests, the United States must be prepared to take
appropriate steps in response, up to and including withdrawal. The manifest failure
and corruption of the World Health Organization (WHO) during the COVID-19
pandemic is an example of the danger that international organizations pose to U.S.
citizens and interests.

The next Administration must end blind support for international organi-
zations. If an international organization is effective and advances American
interests, the United States should support it. If an international organization
is ineffective or does not support American interests, the United States should
not support it. Those that are effective will still require constant pressure from
USS. officials to ensure that they remain effective. Serious consideration should
also be given to withdrawal from organizations that no longer have value, quietly
undermine U.S. interests or goals, or disproportionately rely on U.S. financial con-
tributions to survive.

The Trump Administration’s “tough love” approach to international organiza-
tions served American interests. For example, the Trump Administration withdrew
from, or terminated funding for, the United Nations Human Rights Council, the
United Nations Educational, Scientific and Cultural Organization, the United
Nations Relief and Works Agency, and the WHO. The results were redeployment
of taxpayer dollars to better uses—and other organizations “getting the message”
that the United States will not allow itself and its money to be used to undermine
its own interests.

The Biden Administration reversed many of these decisions. Currently, U.S.
funding for international organizations is more than $16 billion in fiscal year
2021—a sharp increase from $10.8 billion in fiscal year 2015.” Millions of American
taxpayer dollars go to support policies and initiatives that hurt the United States
and American citizens.

The next Administration should direct the Secretary of State to initiate a
comprehensive cost-benefit analysis of U.S. participation in al/ international
organizations. This review should take into account long-standing provisions in
federal law that prohibit the use of taxpayer dollars to promote abortion, popu-
lation control, and terrorist activities, as well as other applicable restrictions on
funding for international organizations and agencies with a view to withholding
U.S. funds in cases of abuses.

International organizations should not be used to promote radical social pol-
icies as if they were human rights priorities. Doing so undermines actual human
rights and weakens U.S. credibility abroad. The next Administration should use
its voice, influence, votes, and funding in international organizations to pro-
mote authentic human rights and respect for sovereignty based on the binding

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international obligations contained in treaties that have been constitutionally

ratified by the U.S. government. It must promote a strict text-based interpreta-
tion of treaty obligations that does not consider human rights treaties as “living

instruments” both within the State Department and within international organi-
zations that receive U.S. funding, including by making respect for sovereignty and

authentic human rights a litmus test of personnel decisions and elections processes

within international organizations.

The U.S. Commission on Unalienable Human Rights focused on the primacy
of civil and political rights in its inaugural report, which remains an important
guidepost for bilateral and multilateral engagements on human rights. The com-
mission’s report is a roadmap for revamping and reenergizing U.S. human rights
policy and should be the basis for both structural and policy changes throughout
the State Department.” All U.S. multilateral engagements must be reevaluated
in light of the work of the commission, and initiatives that promote controversial
policies must be halted and rolled back.

It is paramount to create a healthy culture of respect for life, the family, sover-
eignty, and authentic human rights in international organizations and agencies. To
support this goal, the U.S. led an effort during the Trump Administration to forge a
consensus among like-minded countries in support of human life, women’s health,
support of the family as the basic unit of human society, and defense of national
sovereignty. The result was the Geneva Consensus Declaration on Women’s Health
and Protection of the Family.” All U.S. foreign policy engagements that were pro-
duced and expanded under the Obama and Biden Administrations must be aligned
with the Geneva Consensus Declaration and the work of the U.S. Commission on
Unalienable Human Rights.

The U.S. government should not and cannot promote or fund abortion in inter-
national programs or multilateral organizations. Technically, the United States can
prevent its international funding from going toward abortions, but the U.S. will
have a greater impact by including like-minded nations and building on the coali-
tion launched through the Geneva Consensus Declaration, with a view to shaping
the work of international agencies by functioning as a united front.

The COVID-19 pandemic made it painfully clear that both international organi-
zations—and some countries—are only too willing to trample human rights in the
name of public health. For example, the WHO was, and remains, willing to support
the suppression of basic human rights, partially because of its close relationship
with human rights abusers like the PRC.

The next Administration should unequivocally embrace the premise that
humanity and the international community can simultaneously tackle pandem-
ics and other emergent health threats without impeding the rights of people. It
must also become a vocal surrogate for people in countries where rights are being
suppressed in the name of health. This will likely require greater restrictions on

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the supply of federal dollars to the WHO and other health-focused international
organizations pending adjustment of their policies.

The United States must return to treating international organizations as vehi-
cles for promoting American interests—or take steps to extract itself from those
organizations.

SHAPING THE FUTURE

Development of a grand foreign policy strategy is key to the next Administra-
tion’s success, but without addressing structural and related issues of the State
Department, this strategy will be at risk. The Hart-Rudman Commission called for
a significant restructuring of the State Department specifically and foreign assis-
tance programs generally, stating that funding increases could only be justified if
there was greater confidence that institutions would use their funding effectively.”
Sadly, the exact opposite has occurred. The State Department has metastasized in
structure and resources, but neither the function of the department nor the use of
taxpayer dollars has improved. The next Administration can take steps to remedy
these deficiencies.

The State Department’s greatest problem is certainly not an absence of
resources. As noted, the department boasts tens of thousands of employees and
billions of dollars of funding—including significant amounts of discretionary fund-
ing. It also exists among a broader array of federal agencies that are duplicative,
particularly when it comes to the provision of direct and indirect foreign assistance.
Realistically, meaningful reform of the State Department will require significant
streamlining.

Below are some key structural and operational recommendations that will be
essential for the next Administration’s success, and which will lay crucial founda-
tions for other necessary reforms.

e Develop a reorganization strategy. Despite periodic attempts by
previous Administrations Gncluding the Trump Administration) to make
more than cosmetic changes to the State Department, its structure has
remained largely unchanged since the 20th century.”* The State Department
will better serve future Administrations, regardless of party, if it were to
be meaningfully streamlined. The next Administration should develop
a complete hypothetical reorganization of the department—one which
would tighten accountability to political leadership, reduce overhead,
eliminate redundancy, waste fewer taxpayer resources, and recommend
additional personnel-related changes for improvement of function.

Such reorganization could be creative, but also carefully review specific
structure-related problems that have been documented over the years.
This reorganization effort would necessarily assess what office closures

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Mandate for Leadership: The Conservative Promise

can be carried out with and without congressional approval. Timelines for
action on these fronts should be developed accordingly, but speed should
be a priority.

Consolidate foreign assistance authorities. Foreign assistance is a
critical foreign policy tool that is too often disconnected from the federal
government's practice of foreign policy. Bureaucrats spend significant
energy resisting the use of non-emergency foreign assistance to leverage
positive results for the United States, even though it is a perfectly
reasonable proposition. The coordination of foreign assistance dollars is
also difficult because the foreign assistance budget and foreign loan issuance
authorities are divided across numerous Cabinet departments, smaller
agencies, and other offices.

The next Administration should take steps to ensure that future foreign
assistance clearly and unambiguously supports the President’s foreign
policy agenda. For example, the next administrator of the U.S. Agency
for International Development, which is technically subordinate to the
State Department, should be authorized to take on the additional role
of Director of Foreign Assistance with the rank of Deputy Secretary and
oversee all foreign assistance. This role—which existed briefly during
the George W. Bush Administration before it was eliminated by the
Obama Administration—would empower the dual-hatted official to better
align and coordinate with the manifold foreign assistance programs
across the federal government. The next Administration should also
evaluate whether these multiple sources of foreign assistance are in

the national interest and, if not, develop a plan to consolidate foreign
assistance authorities.

Make public diplomacy and international broadcasting serve
American interests. A key part of U.S. foreign policy is the ability to
communicate with not only governments but with the peoples of the world.
Indeed, in some ways, communicating directly with the public is more
important than communicating with governments, particularly in times of
governmental conflict or disagreement. Public diplomacy has historically
been, and remains, vital to American foreign policy success. Unfortunately,
USS. public diplomacy, which largely relies on taxpayer-funded international
broadcasting outlets, has been deeply ineffective in recent years.

The U.S. government’s first foray into international broadcasting started
with the Voice of America radio broadcast in 1942, which was intended as

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2025 Presidential Transition Project

a tool to communicate directly with the people of Europe during World
War II. During the next half-century, America’s international broadcasting
efforts both expanded and increased in sophistication as the United States
shifted out of its “hot” war in Europe and into the Cold War with the
Soviet Union. U.S. international broadcasting prowess, and the confident
willingness to communicate the correctness of American ideals in the face
of global resistance, arguably hit its peak near the conclusion of the Cold
War in the late 1980s.

Since the fall of the Berlin Wall in 1989 and the subsequent collapse

of Soviet and Eastern Bloc Communism, factors including the false

appeal of a so-called peace dividend triggered a slide in the U.S. ability to
communicate a pro-freedom message to the rest of the world and in its
commitment to do so. Ironically, this slide accompanied the rise of the
Internet and mobile phone technologies, which arguably facilitated the
most significant revolution in human communication since the invention of
the printing press.

The United States must reassert its public diplomacy obligations by
restoring its international broadcasting infrastructure as part of the broader
US. foreign policy framework, consolidating broadcasting resources and
recommitting to people-focused and pro-freedom messaging and content.

Engage in cyber diplomacy. Cyberspace has become an arena for
competition between the U.S. and nations that seek and export digital
authoritarianism. Cyberspace protection is critical to national security and
deserving of commensurate diplomatic resources. Defined as “the use of
diplomatic tools to address issues arising in and through cyberspace,” cyber
diplomacy is a key part of the U.S. government’s toolkit for preventing and
addressing cyber threats.**

The model for cyberspace that the U.S. espouses is based on democracy

and freedom of information. It is “an open, interoperable, secure, reliable,
market-drive, domain that reflects democratic values and protects privacy.””>
Russia and China, meanwhile, are authoritarian regimes that use the
Internet to limit public opposition and control information. They have
created technological tools to enforce dominance over their peoples, and

at the U.N. and international organizations dealing with cyberspace, they
strive to push standards that assist their totalitarian efforts and undermine
Western nations.

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Mandate for Leadership: The Conservative Promise

Simultaneously, Russia, China, and lesser adversaries exploit the more
open networks of countries like the U.S. to undermine democracy through
disinformation and propaganda. They have attempted to influence U.S.
elections; enabled or encouraged actors to exploit cyber vulnerabilities

to commit theft of real or intellectual property; and have challenged

US. governmental, military, and critical infrastructure networks with
targeted malware.

In short, the cyberspace era has gradually evolved from one of exploration,
innovation, and cooperation to one that retains these features but is also
marked by aggressive competition and persistent threats. To meet this
reality, the State Department must move beyond its traditional model of
attempting to establish non-binding, informal world standards of acceptable
cyberspace behavior. The State Department should work with allies to
establish a clear framework of enforceable norms for actions in cyberspace,
moving beyond the voluntary norms of the United Nations Group of
Governmental Experts.”°

The State Department should also assist the Department of Defense to go
“on offence” against adversaries. “Deterrence as a strategic approach has not

stemmed the onslaught of cyber aggression below the level of armed conflict.”?’
The traditional U.S. defensive approach based on deterrence followed by
reaction to crossed “red lines” is no longer effective. Adversaries can evade
this strategy through multiple tactical lines of action below the level of
armed conflict, and such actions have a cumulative strategic effect. The State
Department’s role should be to work with allies and engage with adversaries
when necessary to draw clear lines of unacceptable conduct. Global financial
infrastructure, nuclear controls, and public health are particularly important
areas in which consensus may even be found across ideological lines.

These mission-essential institutional initiatives should be joined with others

to establish a presidentially directed and durable US. foreign policy.

CONCLUSION

The next conservative President has the opportunity and the duty to restructure

the creation and execution of U.S. foreign policy so that it is focused on his or her

vision for the nation’s role in the world. The policy ideas and reform recommen-

dations outlined in this chapter provide guidance about how the State Department

can contribute to this objective.

In the main, this chapter refocuses attention away from the special interests

and social experiments that are used in some quarters to capture U.S. foreign policy.

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2025 Presidential Transition Project

The ideas and recommendations herein are premised on the belief that a rigorous

adherence to the national interest is the most enduring foundation for U.S. grand
strategy in the 21st century.

AUTHOR’S NOTE: Thanks to the entire State Department chapter team, the leaders and staff of the 2025
Presidential Transition Project, and my colleagues at The Heritage Foundation’s Davis Center. In particular, | would
like to acknowledge the following colleagues: Russell Berman, Sarah Calvis, James Carafano, Spencer Chretien,
Wesley Coopersmith, Paul Dans, Steven Groves, Simon Hankinson, Joseph Humire, Michael Pillsbury, Max Primorac,
Reed Rubenstein, Brett Schaefer, Jeff Smith, Hillary Tanoff, Erin Walsh, and John Zadrozny.

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Mandate for Leadership: The Conservative Promise

ENDNOTES

20.

The balance of employ
Department of State, “
anagement, Decemb
pdf (accessed March 9,
U.S. Commission on
February 15, 2001, p. x,
See Bret

process/report/how-m
Historica
Republican Adminis
Administrations.

U.S. Constitution, art. 2

mmigration and

For additional con

The Article X for China

Kennan, “The Sources of Sovie
on/1947-07-01/sources-soviet-conduct (accessed March 22, 2023).

russian-federa
Dean Cheng et al., “Ass
Decades,” Heritage Fo
report/assessing-beijin
Eric W. Orts, “The Rule

h
U.S. Department of De
Networked Region, Jun
DEFENSE-INDO-PACIF

https://www.heritage.o

com/66008-why-oil-in
“Changes in the Arctic:

ationa

D. Schaefer, “How
Policy,” Heritage Foundation

ly, roughly one-third of ambassadorial appointments have been political appointments,
rations

ews release, “Secretary Blinken Launches the Of
December 16, 2022, https://www.state.gov/secretary-blinken-launches-the-office-of-china-coordination/
(accessed March 9, 2023).

ationality Act, 8 U.S. Code § T1101 et seq., § 1253.

See Michael Pillsbury, 7he Hundred Year Marathon: China’s Secret Strategy to Replace the United States as a
Global Superpower (NY: St. Martin’s Griffin, 2016).

ext regarding how countering China fi
Carafano et al., “Foreign Po
July 21, 2022, https://www.heri

Emma Bryce, “Why Is T

U.S. Department of State, “About the U.S. Department of State: Our History,” https://www.state.gov/about/
(accessed March 9, 2023).

ment is 2,149 eligible family members and 50,223 locally employed staff. U.S.

GTM Fact Sheet: Facts About Our Most Valuable Asset—Our People,” Global Talent

er 31, 2022, https:/\www.state.gov/wp-content/uploads/2023/01/GTM_Factsheet1222.
2023).
Security, Road Map for National Security: Imperative for Change, Phase
http://govinfo.library.unt.edu/nssg/PhaselllFR.pdf (accessed March 9, 2023).
0 Make the State Department More Effective at Implementing U.S. Foreign
Backgrounder No. 3115, April 20, 2016, https://www.heritage.org/political-
ake-the-state-department-more-effective-implementing-us-foreign.

Il Report,

although

have generally had a higher ratio of political appointments than Democratic

sec. 2, cl. 2.

ice of China Coordination,” U.S. Department of State,

Sina more robust U.S. strategy, see James Jay
Strategy for a Post-Biden Era,” Heritage Foundation Backgrounder No. 3715,
age.org/defense/report/foreign-policy-strategy-post-biden-era.
d follow George Kennan’s Article X for U.S.-Soviet competition. See George F.
Conduct,” Foreign Affairs, July 1947, https://www.foreignaffairs.com/articles/

icy:

wou

essing Beijing’s Power: A Blueprint for the U.S. Response to China Over the Next

ndation Special Report No. 221, February 20, 2010, https://www.heritage.org/asia/
gs-power-blueprint-the-us-response-china-over-the-next-decades.
of Law in China,” Vanderbilt Journal of Transnational Law, Vol. 34, No. 1 January 2001),

tos://scholarship.law.vanderbilt.edu/cgi/viewcontent.cgi?article=1686&context=vjtl (accessed March 9, 2023).

ense, Indo-Pacific Strategy Report: Preparedness, Partnerships, and Promoting a
e 1, 2019, https://media.defense.gov/2019/Jul/01/2002152311/-1/-1/1/DEPARTMENT-OF-
C-STRATEGY-REPORT-2019.PDF (accessed July 28, 2022).

See Jeff Smith, “South Asia: A New Strategy,’ Heritage Foundation Backgrounder No. 3721, August 29, 2022,

g/asia/report/south-asia-new-strategy.

here So Much Oil in the Arctic?” Live Science, August 3, 2019, httos://Awww.livescience.
-arctic.html (accessed February 9, 2023).

Background and Issues for Congress,” Congressional Research Service Report for

Congress, upda
arch 9, 2023).
U.S. Department o
Distance in the Arctic,”
snapshot-overcoming-
U.S. Department of Sta
https://www.state.gov/\
U.S. Department of Sta
www.state.gov/u-s-con
U.S. Department of Sta
uploads/2020/07/Draf

ed January 26, 2021, p. 6, https://crsreports.congress.gov/product/pdf/R/R41153/177 (accessed

Homeland Security, Science and Technology, “Snapshot: Overcoming the Tyranny of

April 20, 2020, https://www.dhs.gov/science-and-technology/news/2020/04/20/
yranny-distance-arctic (accessed February 9, 2023).

e, “U.S. Contributions to International Organizations, 2021,” September 20, 2022,
u-s-contributions-to-international-organizations-2021/ (accessed March 9, 2023), and
e, “U.S. Contributions to International Organizations, 2015,” November 1, 2016, https://
ributions-to-international-organizations-2015/ (accessed March 9, 2023).

e, Report on the Commission of Inalienable Rights, https://www.state.gov/wp-content/
-Report-of-the-Commission-on-Unalienable-Rights.pdf (accessed March 9, 2023).

— 198 —

2025 Presidential Transition Project

21. “Geneva Consensus Declaration on Promoting Women’s Health and Strengthening the Family,” October
22, 2021, https://www.theiwh.org/wp-content/uploads/2022/02/GCD-Declaration-2021-2.pdf (accessed
arch 13, 2023).
22. US. Commission on National Security, Road Map for National Security.
23. U.S. Department of State, “Organization Chart,” November 2004, https://2009-2017state.gov/s/d/rm/rls/
perfrot/2004/html/39764.htm (accessed March 9, 2023); U.S. Department of State, “Organization Chart,”
ovember 2016, https://2009-2017state.gov/documents/organization/263637.pdf (accessed March 9, 2023);
U.S. Department of State, “Organization Chart,” February 2020, https://2017-2021.state.gov/wp-content/
uploads/2021/01/Dept-Org-Chart-Feb-2020-508.pdf (accessed March 9, 2023); U.S. Department of State,
“DOS Org Chart August 2021,” August 2021, https://www.state.gov/department-of-state-organization-chart/
dos-org-chart-august-2021/ (accessed March 9, 2023); and U.S. Department of State, “Organization Chart,”
ay 2022, https://www.state.gov/wp-content/uploads/2022/05/DOS-Org-Chart-5052022-Non-Accessible.

pdf (accessed March 9, 2023).

24. Emily 0. Goldman, “Cyber Diplomacy for Strategic Competition: Fresh Thinking and New Approaches
Are Needed on Diplomacy’s Newest Frontier,” Foreign Service Journal, June 2021, http://afsa.org/cyber-
diplomacy-strategic-competition (accessed March 9, 2023).

25. Emily Goldman, “From Reaction to Action: Adopting a Competitive Posture in Cyber Diplomacy,’ Texas

National Security Review, Vol. 3, No. 4 (Fall 2020), https://tnsr.org/wp-content/uploads/2020/09/TNSR-Vol3-

ss4-Goldman.odf (accessed March 9, 2023).

26. United Nations General Assembly, “Group of Government Experts on Advancing Responsible State Behaviour

in Cyberspace in the Context of International Security,” A/76/135, July 14, 2021, https://front.un-arm.org/wp-
content/uploads/2021/08/A_76_135-2104030E-1.pdf (accessed March 10, 2023).

27. Goldman, “Cyber Diplomacy.”

— 199 —

INTELLIGENCE
COMMUNITY

Dustin J. Carmack

MISSION STATEMENT

To arma future incoming conservative President with the knowledge and tools
necessary to fortify the United States Intelligence Community; to defend against
all foreign enemies and ensure the security and prosperity of our sovereign nation,
devoid of all political motivations; and to maintain constitutional civil liberties.

OVERVIEW

The United States Intelligence Community (IC) is avast, intricate bureaucracy
spread throughout 18 independent and Cabinet subagencies.' According to the
Office of the Director of National Intelligence (ODND, the IC’s mission is “to col-
lect, analyze, and deliver foreign intelligence and counterintelligence information
to America’s leaders so they can make sound decisions to protect our country.””

An incoming conservative President needs to use these intelligence authorities
aggressively to anticipate and thwart our adversaries, including Russia, Iran, North
Korea, and especially China, while maintaining counterterrorism tools that have
demonstrated their effectiveness. This means empowering the right personnel
to manage, build, and effectively execute actions dispersed throughout the IC to
deliver intelligence in an ever-challenging world. It also means removing redun-
dancies, mission creep, and IC infighting that could prevent these collection tools
from providing objective, apolitical, and empirically backed intelligence to the IC’s
premier customer: the President of the United States.

Today, as Abraham Lincoln famously said, “The occasion is piled high with
difficulty, and we must rise with the occasion.... [W]e must think anew, and act

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Mandate for Leadership: The Conservative Promise

anew.” The Intelligence Community maintains an incredible capacity to achieve

its mission, but both the IC and the somewhat antiquated infrastructure that sup-
ports it often place too high a priority on yesterday’s threats and methodologies

instead of trying to identify possible future threats or the methodologies that

might be needed to combat them. The IC also often spends too much time over-
correcting for past mistakes. The unintended consequences include hesitancy,
groupthink, and an overly cautious approach that allows personal incentives to

drive preset courses.

The IC must be perceived as a depoliticized protector of America’s civil rights
and security. The American people are understandably frustrated by the fact that
those who abuse power are rarely held to account for their actions. This must
change, beginning with leadership that is both committed to ensuring that these
agencies faithfully execute the laws of the land under the Constitution and resolved
to punish and remove any officials who have abused the public trust.

The IC must also start to look forward, not backward. A concerted, disciplined,
leadership-led initiative must be undertaken to refocus and shift IC prioritization,
funding, and authorities to new and emerging threats, technologies, and methodol-
ogies if the United States is to prevail against its global adversaries.* Unfortunately,
America’s major strategic threat is a nation-state peer and possibly ahead of the
USS. in strategic areas. An incoming President must understand that today’s intel-
ligence competition could well require analyzing technologies the U.S. does not
have or compartmentalizing certain information as was done during the Cold
War because of intelligence penetration. A future President’s ability to drive the
resources needed to defeat another nation-state giant should therefore be the
focus of near-term IC reforms.

OFFICE OF THE DIRECTOR OF NATIONAL INTELLIGENCE (ODNI)

The ODNI was established in the aftermath of the attacks on 9/11 and intelli-
gence failures leading up to the 2003 U.S. war in Iraq. The office and its functions
stem from authorities established under executive orders promulgated by
President George W. Bush in 2004, followed by statutory authorizations in the
Intelligence Reform and Terrorism Prevention Act of 2004 (IRTPA).°

Proponents of an ODNI hoped to establish reforms similar to the Goldwater-
Nichols Department of Defense (DOD) reforms of the 1980s, which identified
recurring problems within DOD’s command-and-control architecture and led to
unified Combatant Commands with the Chairman of the Joint Chiefs of Staff as
the senior ranking member of the armed forces and principal military adviser to
the President. The ODNI was envisioned as a small but powerful IC coordinating
agency led by a Director of National Intelligence (DND. As the President’s principal
intelligence adviser, the DNI would lead and provide oversight of the President’s
intelligence authorities while wielding a cudgel—budget and appointment

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2025 Presidential Transition Project

authorities—to break institutional silos that had caused past intelligence inte-
gration failures.

Originally envisioned by the 9/11 Commission as a strengthened, authoritative
position, the final congressionally negotiated product signed by President Bush
has led to ambiguous and vague authorities that are dependent on who is selected
as DNI and Central Intelligence Agency (CIA) Director and their level of support
from the White House and National Security Council (NSC). 9/11 Commission
Executive Director Philip Zelikow warned in a 2004 hearing that creating a new
agency “lacking any existing institutional base...would require authorities at least
as strong as those we have proposed or else it would create a bureaucratic fifth
wheel that would make the present situation even worse.”® The ODNI has become
that bureaucratic fifth wheel about which Zelikow warned.

For example, under the Bush Administration’s initial legislative proposal, the
CIA Director would have been under the “authority, direction, and control” of the
DNI and no longer the head of an autonomous agency. Additional mechanisms
envisioned full budget authority for the DNI, including within DOD’s intelligence
components, as opposed to coordinating authority. Through arduous “sau-
sage-making” and relatively quick negotiations, lawmakers produced statutorily
vague authorities that traded away the DNI’s ability to direct budgetary authority
across the entire IC, including DOD, and left the CIA a subordinate but indepen-
dent agency with duties to report to the DNI without explicit directing authority.

These statutory developments were what led President Bush’s first choice to
serve as DNI, Robert Gates, to turn down the position. In discussions with the
White House over the post, Gates noted that the “legislation weakened the lead-
ership of the community” and that “instead of a stronger person, you ended up
with a weaker person because the DNI had no troops and no additional powers
really on the budget, hiring, and firing.”’ Gates noted that success would require
the President to “make explicit publicly that the DNI is head of the Intelligence
Community, not some budgeter or coordinator,” and that “[t]he position’s only
prayer of success is for the president to say plainly...how he sees the job. Without
his explicit mandate...the endeavor is doomed to fail.”®

One of the two DNIs confirmed by the Senate during the Trump Administra-
tion, John Ratcliffe, acknowledged that Gates’s theoretical concerns became the
practical reality that he inherited:

Prior DNIs were the head of the IC only on paper and were routinely
accustomed to yielding IC actions and decisions to the preferences of the
CIA and other agencies. My ability to begin reversing that capitulation was
accomplished solely because President Trump made it repeatedly clear to the
entire national security apparatus that he expected all intelligence matters to
go through the DNI.°

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Mandate for Leadership: The Conservative Promise

To help further the legislative intent behind IRTPA, DNI Ratcliffe advised
during the transition of incoming Biden DNI Avril Haines that the DNI should
be the only Cabinet-level intelligence official.!° While his recommendation was
adopted and has corrected the previously allowed imbalance by making the DNI
the only Cabinet official and head of the IC at the table, the ODNI’s effectiveness
and direction leave much to be desired.

A conservative President must decide how to empower an individual to oversee
and manage the Intelligence Community effectively. To be successful, the DNI
and ODNI must be able to lead the IC and implement the President’s intelligence
priorities. This includes being able to exercise both budget and personnel authority
and being able to rely on timely, useful feedback from subordinate components of
the IC, many of which are located within other Cabinet agencies.

The ODNI needs to direct, not replicate in-house, the other IC agencies’ analytic,
operational, and management functions. Considerations like mismanagement
of human resources, joint-duty assignments, and accelerated growth in senior
personnel can cause a President to dictate to his incoming DNI a desire to slash
redundant positions and expenditures while simultaneously giving the DNI the
authority to drive necessary changes throughout the IC to deal with the nation’s
most compelling threats, including those emanating from China. As John Ratcliffe
has noted, “These are essential to the DNI having the abilities and authorities to
effectively direct, coordinate, and tackle the immense national security challenges
ahead for the Intelligence Community as intended under IRTPA.”""

Otherwise, other Cabinet and subordinate IC agencies will continue to regard
the ODN1I as an annoyance and not as a positive contributor to the National Intel-
ligence Program (NIP) budget. They will continue to work around or circumvent
ODNI leadership decisions with appropriators and the Office of Management and
Budget (OMB) or seek to wait out an Administration or DNI to prevent a policy or
intelligence priority from reaching fruition.

Intelligence and interagency coordination has improved significantly since
9/11. Nevertheless, interagency rivalries and festering issues continue to cause
duplication of effort on intelligence analysis and technology purchases as well as
overclassification and ever-increasing compartmentalization. Additional issues
include the abuse of mandated onboarding approval and reciprocity timelines by
some agencies, recruitment and retention failures, and a lack of will to remove
underperforming or timely adjudicate the misconduct of senior managers and
other employees.

Finally, future IC leadership must address the widely promoted “woke” cul-
ture that has spread throughout the federal government with identity politics and
“social justice” advocacy replacing such traditional American values as patriotism,

colorblindness, and even workplace competence.

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2025 Presidential Transition Project

EXECUTIVE ORDER 12333
IRTPA was passed in the aftermath of the 9/11 attacks against the homeland. It
was intended to improve the sharing of information among the elements of the
IC, recognizing that the nature of the threats we now face blurs the lines between
foreign and domestic intelligence in detecting and countering national security
threats against the homeland. An equally important objective in passing the most
significant intelligence reform since the National Security Act of 1947” was cre-
ation of the position of DNI, charged with assuming two of the three principal roles
that formerly belonged to the Director of Central Intelligence (DCI): serving as
principal intelligence adviser to the President and leading the IC as an enterprise.
Nearly two decades later, the DNI’s record of effectiveness in improving the
sharing of information and operating the IC as an enterprise is mixed. Implemen-
tation of the DNI’s roles as leader of the IC and principal intelligence adviser to
the President has been challenging. However, despite flaws in the legislation and
intelligence agencies’ bureaucratic jockeying that undermine the DNI, it is impos-
sible to know what would emerge if Congress were to revisit the act. Seeking a
legislative solution therefore might carry with it more risks than benefits. Instead,
an incoming conservative President’s immediate focus should be on modifying
Executive Order 12333, the President’s direction for implementing IRTPA.”
Executive Order 12333 was last amended on July 30, 2008, by President George
W. Bush.” The revisions were aligned with IRTPA with significant emphasis on
having the IC address the threats to the homeland from international terrorism
and the proliferation of weapons of mass destruction. There is scant mention of
cyber threats and the evolving national security challenges posed by China, Russia,
and other U.S. adversaries. By extension, the revised order fell short of stipulat-
ing how the DNI would execute his authority to organize the IC in a manner that
improves the delivery of timely intelligence to a wide array of customers.
Executive Order 12333 should be amended to take account of the changing
landscape of threats and improve the functional aspects of America’s intelligence
enterprise. To that end, a revised order should:

e Address the threats to the United States and its allies in cyberspace.
These threats range from cyberwarfare to information operations. The
amended order should clearly delineate the roles and responsibilities of
the various U.S. government cyber missions, including the recently created
National Cyber Director’s Office and power centers at the NSC, while
protecting the privacy and civil liberties of US. citizens.

Under the DNI’s direction, the cyber mission should explicitly identify

how information in the cyber domain will be shared promptly with the
warfighters, from law enforcement agencies to the broader IC and state,

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Mandate for Leadership: The Conservative Promise

local, and tribal elements. The order should consider stipulating what to
do with DOD cyber agencies, most notably the NSA, in terms of strategic
(for example, the President and the DND vs. tactical support (for example,
support for the warfighter) in conjunction with ongoing congressionally
mandated reviews of the future dual-hatted relationship.

Enhance the DNI’s role in overseeing execution of the National
Intelligence Program budget under the President’s authority. This
should be done in a manner that is consistent with Congress’s intent as
embodied in IRTPA. Under the executive order as written today, the DNI

“shall oversee and direct the implementation of the National Intelligence
Program.” In practice, the DNI’s authority to oversee execution of the IC’s
budget remains constrained by an inability to address changing intelligence
priorities and mandate the implementation of appropriated NIP funding to
higher intelligence priorities.

The DNI should have the President’s direction to address emerging but
catastrophic threats such as those posed by bioweapons. Clarifying how
much budget authority the DNI has in conjunction (within the limits of
congressional appropriations) with OMB and IC-member Cabinet officials
to move around money and personnel is crucial, but positions will not
always be fungible. It will probably be necessary to hold IC leadership
accountable at intransigent agencies and to restructure areas through
executive orders in close conjunction with OMB, as needed.

Clarify the DNI’s role as leader of the IC as an enterprise in building the
IC’s capabilities around its open-source collection and analytic missions.
The exponential growth in open-source information, often called OSINT, is not
disputed. In the IC, the use of publicly available information, notwithstanding
the authorities within IRTPA for the DNI to manage OSINT, remains
disaggregated. The explosion of private-sector intelligence products and
expertise should signal to IC leadership that duplicative efforts are unnecessary
and that limited resources should be focused on problematic collection tasks.

The IC should avoid duplication of what is already being done well in

the private sector and focus instead on complex questions that cannot

be answered by conventional and frequently increasing numbers of
commercial tools and capabilities. If necessary, for lack of results from the
National Open Source Committee, the DNI should appoint the Principal
Deputy Director of National Intelligence (PDDND as chairman to prioritize
and promote accountability for the IC’s 18 agencies toward this effort.

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2025 Presidential Transition Project

Prioritize security clearance reform. Security clearance reform has
made significant progress under Trusted Workforce 2.0, a governmentwide
background investigation reform that was implemented beginning in 2018
with the goal of creating one system with reciprocity across organizations.
This included allowing movement from periodic reinvestigations toward

a Continuous Vetting (CV) program with automated records checks,
adjudication of flags, the “mitigat[ion of] personnel security situations
before they become a larger problem,” or the suspension or revocation of
clearances.’ However, human resources onboarding operations in major
agencies such as the CIA, FBI, and NSA remain to be resolved.

As executive agent for security clearances, the DNI must require results
from agencies that resist implementation, enforce the 48-hour reciprocity
guidance, and target human resources operations that fail to attract and
expediently onboard qualified personnel. Additional “carrots and sticks”
from executive order reform language, including moving the Security
Services Directorate from NCSC to ODNI with elevated status, may be
necessary. It is unacceptable for agencies to hinder opportunities for cross-
agency assignments, use public-private partnerships inefficiently because
of constraints on the transferability of security clearances, and lose future
talent because of extraordinary delays in backend operations. Proper vetting
to speed the onboarding of personnel with much-needed expertise is vital to
the IC’s future.

Ensure the DNI’s authority. The DNI’s authority should be similar to an
orchestra conductor’s. An incoming conservative President will appoint
whomever he chooses as DNI, but there should be agreement between the
incoming DNI and President with advice and counsel from the Presidential
Personnel Office on selecting positions overseen by the DNI throughout
subordinate agencies, as well as concurrence by relevant Cabinet officials
and the CIA. This exists by executive order, but many Presidents, PPOs, and
Cabinet agency heads do not follow executive order guidance and necessary
norms. The importance of trust, character, and the ability to work together
to achieve a joint set of intelligence goals established by the President
cannot be overstated: It is a mission that can be accomplished only with the
conductor and his orchestra playing in sync.

Provide additional support for such economic and supply chain-
focused agencies as the Department of Commerce. Information sharing
and feedback can help subagencies like the Commerce Department’s

Bureau of Industry and Security to improve their understanding of the

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threat from China and thereby counter it more effectively. They can also

aid the development of export control mechanisms and potential outbound
investment screening where necessary. Brief, specific governance language
should be considered that would apply counterterrorist authority models to
the broader functions of the U.S. government insofar as they are needed to
counter 21st century nation-state threats.

The success of any DNI rests with support from the President. Any revised
Executive Order 12333 must serve to express unequivocal support for the DNI in
executing the mandates that an amended order would provide.

CENTRAL INTELLIGENCE AGENCY (CIA)

The CIA is a foreign intelligence collection service tasked with collecting human
intelligence (HUMINT), providing all-source intelligence analysis and report-
ing, and conducting covert action when required to do so by the President. The
CIA has its roots in the Office of Strategic Services (OSS), which the United States
established during World War I] as a paramilitary and intelligence collection orga-
nization. After World War II, President Harry Truman disbanded the OSS, and the
CIA was established in law by the National Security Act of 1947.

As with every agency in government, the President’s election sets a new agenda
for the country. Public servants must be mindful that they are required to help
the President implement that agenda while remaining apolitical, upholding the
Constitution and laws of the United States, and earning the public trust. The Pres-
ident requires a CIA that provides unbiased and apolitical foreign intelligence
information and, when necessary, can act capably and effectively on any covert
action findings.

Executing the Mission. The CIA’s success depends on firm direction from the
President and solid internal CIA Director-appointed leadership. Decisive senior
leaders must commit to carrying out the President’s agenda and be willing to take
calculated risks. Therefore:

e The next President-Elect and incoming Presidential Personnel Office
should identify a Director nominee who can foster a mission-driven culture
by making necessary personnel and structural changes.

e The President-Elect should choose a Deputy Director who, without
needing Senate confirmation, can immediately begin to implement the
President’s agenda. This includes halting all current hiring to prevent
the “burrowing in” of outgoing political personnel. Additional appointees
should be placed within the agency as needed to assist the Director in
supervising its functioning.

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e The Director and Deputy Director should request briefings on all CIA
activities and presence overseas, as well as any CIA-controlled access
programs and existing covert action findings, without exception.

e The Director and Deputy Director should meet with all directorates and
mission centers, prioritizing those that are aligned most closely with the
President’s priorities and calibrating collection and operations based on
the President’s intelligence requirements. This includes any areas where
the CIA might be conducting its own diplomacy parallel to official State
Department policy. It must be clear that the CIA’s liaison relationships
overseas must follow and not contradict those set at the policy level by the
President through the State Department.

The other principal offices responsible for executing the CIA’s mission include
the Directorate of Operations, Directorate of Analysis, Directorate of Science and
Technology, Directorate of Support, and Directorate of Digital Innovation. If senior
leadership finds any program or operation to be inconsistent with the President’s
agenda, the Director should immediately halt that program or operation.

Reining in Bureaucracy. The CIA’s bureaucracy continues to grow. Because
mid-level managers lack accountability, there are areas in which personnel are not
responsive to any authority, including the President. The President should instruct
the Director to hire or promote new individuals to lead the various directorates
and mission centers. This new crop of mid-level leaders should carry out clear
directives from senior CIA leadership, which means more accountability and new
ways of thinking to benefit the mission.

In addition, the President should task the Director with significantly broadening
recruitment, expediting onboarding practices, and shifting resources away from
headquarters, including terminal generalist GS-15s when OPM buyouts, forced
rotations, or up-and-out personnel policies are set for particular positions. The
CIA must find creative ways to align mission requirements with hiring needs,
recruit diverse sets of individuals with unique backgrounds, and become more
open to hiring private-sector experts directly into senior positions. In addition,
the Director should break the cabal of bureaucrats in D.C. by permanently moving
various directorates, such as Support and Science and Technology, out of Virginia
and possibly open campuses outside of D.C. where analysts and other experts could
contribute virtually.

Redirecting Resources. Certain CIA employees and offices have focused on
promoting divisive ideological or cultural agendas and fostering a damaging cul-
ture of risk aversion and complacency. As soon as possible, the Director should
divert resources from any activities that promote unnecessary and distracting
social engineering. The Director should implement changes in promotion criteria

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that reward individuals for creative thinking and quality of recruitments and prod-
ucts rather than numeric metrics or the achievement of benchmarks that are not
essential to the mission.

Not all careers in espionage are created equal, and the Director should incentiv-
ize and reward applicants who are willing to accept high risks over those who are
climbing the ranks simply by doing business as usual. The Director should refocus
the CIA to an OSS-like culture and mandate that all CIA employees acquire, as a
condition of securing senior (GS-14+) rank, additional or enhanced language skills,
technical or cyber expertise, or field training or serve in overseas assignments.

COVERT ACTION

Covert action can be a valuable tool in helping further the President’s foreign
policy agenda if implemented in concert with other forms of government power.
As codified in the U.S. Code, “the term ‘covert action’ means an activity or activities
of the United States Government to influence political, economic, or military con-
ditions abroad, where it is intended that the role of the United States Government
will not be apparent or acknowledged publicly...”

The President initiates a covert action with a written finding that explains why

“such an action is necessary to support identifiable foreign policy objectives of the
United States and is important to the national security of the United States.”"” The
statute assumes the President will use the CIA as the principal action element to
achieve the objectives of covert action findings; however, the President need not
feel constrained to utilize only the CIA: “[E]ach finding shall specify each depart-
ment, agency, or entity of the United States Government authorized to fund or
otherwise participate in any significant way in such action.”*®

For example, the Department of Defense maintains certain clandestine capa-
bilities under Title 10 authorities that may resemble but far exceed in scale similar
capabilities outside of DOD. Generally, such DOD capabilities can be employed
outside a combat theater only if they are determined to be traditional military
activities. In practical terms, this means that many DOD capabilities, including
those in the space and cyber domains, can be employed only after the initiation of
armed conflict.’ Given the range of global threats the United States faces today,
the President should consider whether DOD’s complete set of capabilities should
be used to support potential covert actions.

The problem, unfortunately, is that certain elements in the State Department,
IC, and DOD trade on risk aversion or political bureaucracy to delay execution
of the President’s foreign policy goals. A future conservative President should
therefore identify individuals on the transition team who are familiar with the
implementation of covert action with a view to placing them in key NSC, CIA,
ODNI, and DOD positions. These knowledgeable teams can assist in any review
of current covert actions and, potentially, planning for new actions.

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Immediately after the inauguration, the President should task the NSC’s Senior
Director for Intelligence Programs with conducting a 60-day review of any current
covert action findings, including their effectiveness; evaluating new covert actions
that might be needed to implement the President’s foreign policy goals; and report-
ing back to the President. Such an assessment should be conducted independently
of the agencies responsible for the actions under review. As part of the review, the
Senior Director for Intelligence Programs should identify which departments or
agencies, such as the CIA or DOD, are best equipped to achieve the objectives set
out in new and existing findings.

After the 60-day review, the President should demand creative thinking and a
clear strategy as to how covert action fits within the President’s broader foreign
policy strategy, to include possibly modifying or rescinding any current findings,
drafting new findings, and streamlining or eliminating needless bureaucracy, par-
ticularly at State, to facilitate more expeditious decisions on tactical covert action.
Careful thought should be given to the metrics by which the effectiveness of covert
action programs will be measured to ensure the appropriate use of government
resources and to guard against the possibility of covert action’s being used with
little scrutiny in ways that are inconsistent with overt foreign policy goals.

ODNI AND CIA ORGANIZATIONAL RECOMMENDATIONS

The ODNI and CIA operate under authority provided by the Central Intelli-
gence Agency Act of 1949,?° which means they have greater latitude than the rest
of the federal government with respect to the hiring and firing of personnel. Both
organizations and other areas of the IC have struggled from a human resources
and talent management standpoint to recruit, onboard, and maintain personnel
in a timely fashion to fill the IC’s ever-changing needs. At a time when the Intelli-
gence Community needs significantly more personnel with the proper technical,
language-capable, and diverse backgrounds, including applicants from elements
of the business community, the incoming Directors of both agencies need to make
this effort a top priority.

Past DNIs’ Chiefs of Staff and additional front-office staff historically have come
from outside the IC, commonly under a misconstrued “staff-reserve” structure
that is intended to avoid a Schedule C designation within the IC. The Director
should handpick qualified, properly cleared personnel for front-office and mana-
gerial leadership positions, such as the DNI’s Chief of Staff and heads of Legislative
Affairs and Strategic Communications, to oversee those divisions with career IC
staff reporting to them.

The incoming DNI and CIA Director should also consider changes in the Senior
National Intelligence Service (SNIS)/Senior Intelligence Services (SIS). Senior
officers should be required to sign mobility agreements that allow ODNI and CIA
leadership to move them within the IC every two years if necessary. Many qualified

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and distinguished senior officers serve throughout the IC, but some long-serving
generalist officers no longer perform at a high capacity, are management-driven,
do not serve the IC’s changing needs, and limit junior officers’ prospects for growth
and advancement. An incoming Administration should consider studying and
implementing additional requirements as a condition for promotion to GS-15/
SNIS/SIS and explore concepts such as “Up and Out” beginning at the GS-14/15
levels and above for some fields.

The IC should evaluate areas of bloat and underperforming cadre and work
with OPM on authority for voluntary separation buyouts. Allowing ODNI and CIA
leadership to shrink size and reduce duplication of effort while promoting healthy
turnover within their senior ranks would encourage new ideas and perspectives
from mid-career officers and, potentially, from employees hired from outside
their agencies. The ODNI and CIA should maximize their direct-hire and incen-
tive-building authorities to bring in talented and properly cleared individuals to
serve in positions requiring technical, language, and cyber expertise.

Finally, the human resources and talent management systems for onboarding
purposes at the ODNI, CIA, and some other elements of the IC are fundamentally
broken. For example, according to current CIA Director William Burns, it recently
took more than 600 days, on average, for a CIA applicant to receive his or her
necessary security clearance.” Although security clearance procedures have been
somewhat improved in recent years and Burns has committed CIA to reducing that
to no more than 180 days, degradation in other areas of the process has limited the
IC’s capacity to attract qualified and needed expertise.

PREVENTING THE ABUSE OF INTELLIGENCE
FOR PARTISAN PURPOSES

The intelligence function must be protected from bottom-up and top-down
politicization if it is to play its proper role in our national security decision-mak-
ing process. Unfortunately, both types of politicization have occurred recently to
the detriment of the Intelligence Community’s reputation and credibility. More
important, the politicization of intelligence risks contributing to policy fail-
ures (as we saw with the Iraq War) or even undermining our democratic system
here at home.

In particular, the IC must restore confidence in its political neutrality to rectify
the damage done by the actions of former IC leaders and personnel regarding the
claims of Trump-Russia collusion following the 2016 election and the suppression
of the Hunter Biden laptop investigation and media revelations of its existence
during the 2020 election. But the problem is not confined to the executive branch
struggle between the IC and policymakers; it also relates to the IC’s relationship
with Congress as evinced by DNI James Clapper’s failure to answer honestly in
response to congressional questions about government surveillance programs.

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The ODNI and CIA are undergoing a crisis of confidence based on several factors.
First, President Barack Obama’s CIA Director, John Brennan, gravely damaged the
CIA by minimizing the Directorate of Operations and exploiting intelligence analy-
sis as a political weapon after he left office. Brennan’s role in the letter signed by 51
former intelligence officials before the 2020 election is unclear, but in dismissing
the Hunter Biden laptop as “Russian disinformation,” the CIA was discredited, and
the shocking extent of politicization among some former IC officials was revealed.

Restoring respect for the IC as an independent provider of information and
analysis while also ensuring that it is responsive to the legitimate needs of poli-
cymakers will require reinforcing essential norms and institutions. However, we
should also recognize that achieving the perfect balance that avoids the pathologies
of too much distance or too much closeness and responsiveness to policymakers
is not only difficult, but probably impossible.” Thus, given the very nature of the
business and the political process, much will depend on the promotion of certain
norms or virtues on both sides of the principal-agent relationship. Specifically:

e The DNIand CIA Director should use their authority under the National
Security Act of 1947 to expedite the clearance of personnel to meet mission
needs and remove IC employees who have abused their positions of trust.
An area of particular concern is that personnel under investigation for
improprieties have been allowed to retire before internal investigations
have been completed. Directors of both agencies must instill further
confidence in their workforces, Congress, and the American people that
they can and will deal effectively with personnel that fail to live up to their
oath to the Constitution, adhere to ethical and moral standards as expected
by America’s taxpayers, and faithfully execute the law.

e The President should direct the DNI and the Attorney General, by direction
of the respective Inspectors General and IC Analytic Ombudsman, to
conduct a further audit of all IC equities of past politicization and abuses
of intelligence information. For example, a recent IC ombudsman analysis
during the 2020 election cycle noted, “If our political leaders in the White
House and Congress believe we are withholding intelligence because of
organizational turf wars or political considerations, the legitimacy of the

Intelligence Community’s work is lost.”

e The President should immediately revoke the security clearances of any
former Directors, Deputy Directors, or other senior intelligence officials
who discuss their work in the press or on social media without prior
clearance from the current Director. IC agencies, including the CIA, should
minimize their public presence and vigorously investigate any and all leaks

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of information, classified or otherwise. The ODNI and CIA should fire or
refer for prosecution any employee who is suspected of leaking information,
and penalties should include the removal of pension benefits for those who
are found guilty. Additional tools are needed to prevent leaked intelligence
from being used as a weapon in policy debates by IC leaders or decision-
makers in the executive branch or Congress.

In addition, the Department of Justice should use all of the tools at its
disposal to investigate leaks and should rescind damaging guidance by
Attorney General Merrick Garland that limits investigators’ ability to
identify records of unauthorized disclosures of classified information to

the media. Personnel have sufficient access to legitimate whistleblower
claims under protections provided by Inspectors General and Congress. The
Director and IC must prioritize hiring additional counterintelligence and
security personnel to assist in this effort.

Military and civilian IC training should include stronger emphasis

on the norm of political neutrality, including a mandatory course on
professionalism and repercussions for abuse in the execution of duties in all
degree programs at the National Intelligence University.

Intelligence leaders need to model norms of neutrality and respect for the
decision-making authority of the President, appointed officials, and Congress.
This includes building trust with key decision-makers by not using their
positions and privileged access to information to influence policymaking
indirectly or directly in an inappropriate fashion (especially by engaging in
threat inflation). IC leaders should practice extreme restraint in engaging
with the public and the media. They should seek to work in the shadows
rather than in the limelight. Potential restrictions on such appearances could
supplement this norm, preventing political leaders from using IC officials to
support an Administration position as they do with military leaders.

Retired IC leaders should similarly support the neutrality norm by not
becoming public figures.

Congress should not use IC leaders as pawns in policy struggles with the
President or the other party during their appearances before committees of
the House and Senate. While Congress has a proper oversight role, it should
distinguish between information that needs to be public and information
that should be discussed in private with members of the IC. A DNI should
call “balls and strikes” to those on both sides of the aisle on Capitol

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Hill who attempt to weaponize the use of selective intelligence to feed
political narratives.

e Political leaders should avoid “manipulation-by-appointment,” a practice
by which intelligence leaders are selected for their policy views or political
loyalties instead of their skilled expertise.** Presidents should also avoid
public rebukes and pressure from the intelligence profession, which can
include intimidation and bullying, to shape IC analysis. This will be easier if
IC leaders live by the norms of neutrality and thus are not seen as political
actors, for whom political responses are deemed necessary.

e Intelligence leaders and professionals should never “cook the books” for
Presidents or change or shape their analysis to preserve access or status.”

FOREIGN INTELLIGENCE SURVEILLANCE ACT (FISA)

A future President should understand the importance of FISA” while also seek-
ing reforms and accountability for any abuses of its authorities. When discussing
FISA and what changes may need to be made, it is important to note and recognize
that there are stark differences among the individual FISA authorities.

Section 702 of FISA, for example, allows the IC to target foreign terrorists, spies,
cyber hackers, and other bad actors (but only if they are non-U.S. persons) when
their communications pass through the United States. While this authority may
lapse if Congress does not resolve the issue by the end of 2023, Section 702 should
be understood as an essential tool in the fight against terrorism, malicious cyber
actors, and Chinese espionage. These are two major national security priorities
for an incoming President, and it is imperative that the need to use properly main-
tained and accountable authorities to counter these challenges be recognized.

Section 702 is avital program that often provides the lion’s share of intelligence
used in the President’s Daily Brief (PDB).”” An independent review by the Privacy
and Civil Liberties Oversight Board (PCLOB) found that it was not abused. Nev-
ertheless, Congress should review the PCLOB’s upcoming 2023 report to help it
determine whether any reforms or codification of recent administrative changes
in FISA processes are needed.

Other authorities in Title I and Title III, often referred to as “traditional” FISA,
have elicited valid concerns about the politicization of intelligence collection
authority in recent years. When seeking surveillance of Trump campaign adviser
Carter Page, for example, the FBI and the Department of Justice concealed vital
information from a specialized court and submitted applications that were riddled
with errors. An incoming conservative President should consider reforms designed
to prevent future partisan abuses of national security authority. A package of strong
provisions to protect against such partisanship might include:

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e Stiffer penalties and mandatory investigations when intelligence leaks are
aimed at domestic political targets,

e Tighter controls on otherwise lawful intercepts that also collect the
communications of domestic political figures,

e Anexpress prohibition on politically motivated use of intelligence
authorities, and

e Reforms to improve the accountability of the Justice Department and the
Foreign Intelligence Surveillance Court.

To keep intelligence credentials from being used for partisan purposes, former
high-ranking intelligence officials who retain a clearance should remain subject to
the Hatch Act after they leave government to deter them from tying their political
stands or activism to their continuing privilege of access to classified government
information. The IC should be prohibited from monitoring so-called domestic
disinformation. Such activity can easily slip into suppression of an opposition
party’s speech, is corrosive of First Amendment protections, and raises questions
about impartiality when the IC chooses not to act.

CHINA-FOCUSED CHANGES, REFORMS, AND RESOURCES

The term “whole of government” is all too frequently overused, but in
responding to the generational threat posed by the Chinese Communist Party,
that is exactly the approach that our national security apparatus should adopt.
CIA Director William Burns has formally established a China Mission Center
focused on these efforts, but it can be successful only if it is given the necessary
personnel, cross-community collaboration, and resources. That is uncertain at
this point, and just how seriously the organization is taking the staffing of the
center is unclear.

A critical strategic question for an incoming Administration and IC lead-
ers will be: How, when, and with whom do we share our classified intelligence?
Understanding when to pass things to liaisons and for what purpose will be vital
to outmaneuvering China in the intelligence sphere. Questions for a President
will include:

e What is our overarching conception of the adversarial relationship and
competition?

e How does intelligence-sharing fit into that conception?

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Some Members of Congress have said that intelligence relationships such as
the Five Eyes”* should be expanded to include other allies in the Asia—Pacific in, for
example, a “Nine Eyes” framework. This fails to take into account the fact that any
blanket expansion would necessarily involve protecting the sources and methods of
alarger and quite possibly more diverse group of member countries that might or
might not have congruent interests. That being said, however, a future conservative
President should consider what resources and information-sharing relationships
could be included in an ad hoc or quasi-formal intelligence expansion (for example,
with the Quad) among nations trying to counter the threat from China.

Significant technology, language skills, and financial intelligence resources
are needed to counter China’s capabilities.”” The IC was caught flat-footed by the
recent discovery of China’s successful test of a nuclear-capable hypersonic missile.
No longer can America’s information and technological dominance be assumed.
China’s gains and intense focus on emerging technologies have taken it in some
areas from being a near-peer competitor to probably being ahead of the United
States. China’s centralized government allocates endless resources (sometimes
inefficiently) to its strategic “Made in China 2025” and military apparatuses, which
combine government, military, and private-sector activities on quantum infor-
mation sciences and technologies, artificial intelligence (AI, machine learning,
biotechnologies, and advanced robotics.

The IC must do more than understand these advancements: It must rally non-
government and allied partners and inspire unified action to counter them. In
addition, to combat China’s economic espionage, authorities and loopholes in the
Foreign Agents Registration Act (FARA)* will have to be examined and addressed
in conjunction with the Attorney General.

Many issues within the broader government can be tied back to a more general
congressional understanding of the threat due to the compartmentalization of
committee jurisdictions and the responsibilities of executive agencies to brief on
the nature of the threat. Broader committee jurisdictions should receive additional
intelligence from IC agencies as necessary to inform China’s unique and more com-
prehensive threat across layers of the U.S. government bureaucracy and economy.

Former DNI John Ratcliffe increased the intelligence budget as it related to
China by 20 percent. “When people ask me why I did that,” he explained in an
interview, “I say, ‘Because no one would let me increase it by 40%.’ I had an $85
billion combined annual budget for both the national intelligence program and
military intelligence program. My perspective was, ‘Whatever we’re spending on
countering China, it isn’t enough.’”*! From an intelligence standpoint, the need
to understand Chinese motivations, capabilities, and intent will be of paramount
importance to a future conservative President. It is therefore also of paramount
importance that the “whole of government” be rowing together.

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NATIONAL COUNTERINTELLIGENCE AND SECURITY CENTER (NCSC)

The Senate Select Committee on Intelligence (SSCI) has taken a keen inter-
est in possibly updating the codified language underpinning much of the nation’s
counterintelligence apparatus. “Spy vs. spy” threats continue to exist, but the rise
of China and (to an extent) Russia’s machinations move beyond the governmental
sphere to technological, economic, supply chain, cyber, academic, state, and local
espionage threats at a level our country has never seen. The asymmetric threat
includes cyber, nontraditional collection, and issues involving legitimate busi-
nesses Serving as collection platforms.

Barring statutory changes that could occur before 2025, a future conserva-
tive President should further empower and resource the IC by executive order or
through suggested changes in the Counterintelligence Enhancement Act (CEA)
of 2002.*2 NCSC was given some authority for outreach efforts on behalf of the IC
for counterintelligence education, insider threats, and broader U.S. government
best practices, but there remain significant deltas between Title 50 and non-Title
50 entities’ protections. Primary operational elements should remain at the FBI
and CIA, with the Bureau and NCSC collaborating on nongovernmental outreach.

While there is no need to create a separate agency, a future President and DNI
should amplify NCSC’s authorities and roles with respect to counterintelligence
strategy, policy, outreach, and governance, including supporting necessary Joint
Duty Assignments (JDA) for FBI and CIA personnel. At the same time, the FBI
requires significant additional resources and legal authorities to fulfill its statu-
tory role as the lead operational counterintelligence agency in dealing with the
ever-growing threats posed by our adversaries. The CEA should be updated to
include foreign espionage efforts aimed at universities.

Corporate America, technology companies, research institutions, and academia
must be willing, educated partners in this generational fight to protect our national
security interests, economic interests, national sovereignty, and intellectual prop-
erty as well as the broader rules-based order—all while avoiding the tendency
to cave to the left-wing activists and investors who ignore the China threat and
increasingly dominate the corporate world. Reinstitution of the National Security
Higher Education Advisory Board and the National Security Business Alliance
Council should be prioritized with leadership from the NCSC, the FBI, or a com-
bination of both entities.

When the CCP steals at least $400 billion—$600 billion in intellectual prop-
erty each year, it is time to devote some strategic thinking to exactly how and to
what degree counterintelligence efforts can help to protect America’s commercial
endeavors. If Chinese strategic technology gains are happening almost entirely in
transnational commercial space, for example, and the private sector is also gath-
ering and analyzing some critical intelligence, these essential data points should
assist in national-level counterintelligence efforts.

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The NCSC was created in the aftermath of 9/11 as the Terrorist Threat Integra-
tion Center (TTIC), which later became the National Counterterrorism Center
(NCTC) pursuant to President George W. Bush’s Executive Order 13354.** The
NCTC was an organization of approximately three dozen detainees from across
the U.S. government with a mandate to integrate counterterrorism intelligence
and missions, including terrorist screening. Eventually:

In November 2014 the Director of National Intelligence (DNI) established
NCSC by combining [the Office of the National Counterintelligence
Executive] with the Center for Security Evaluation, the Special Security
Center and the National Insider Threat Task Force, to effectively integrate
and align counterintelligence and security mission areas under a single
organizational construct. The Director of NCSC serves in support of the DNI’s
role as Security Executive Agent (SecEA) to develop, implement, oversee and
integrate personnel security initiatives throughout the U.S. Government.**

NCSC has added value in such areas as fusing cross-community intelligence for
terrorism watchlisting purposes and improving information sharing while carrying
roughly half of the overall cadre for the ODNI. An incoming Administration should
focus NCTC on integrative tasks, many of which cannot be carried out elsewhere
in the IC, but should not use personnel and resources for redundant analyses that
duplicate the work of such other IC entities as the FBI and CIA.

ADDITIONAL AREAS FOR REFORM

Analytical Integrity. The “tradecraft” of intelligence analysis is mostly a col-
lection of lessons learned over decades about what works and does not work ina
profession whose high-stakes work is performed by thousands but that also bears
little outside scrutiny and provides few metrics by which to gauge success or failure
on aregular basis. These lessons have accumulated from:

e The perceived misuse of intelligence by consumers as was the case with
respect to war-related assessments in the Johnson and Bush Administrations;

e Failures such as the failures to warn of the collapse of the Soviet Union and
the specific threat of 9/11;

e Successes in piecing together tactical and often technical puzzles such as
estimates of Iranian nuclear program maturation; and

e Strategic victories such as anticipating critical geopolitical developments
that have been years in the making.

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Historically, this tradecraft has been passed on in the form of unwritten rules
learned on the job and in agency-specific training classes, but increasingly since the
intelligence reforms of 2004, they have been codified IC-wide under the direction
of the Deputy Director of National Intelligence for Mission Integration.

A RAND study of U.S. intelligence tradecraft notes that the “vast majority of
intelligence analysts reside outside the Central Intelligence Agency and do work
that is tactical, operational, and current.”** The study goes on to note that the
Defense Intelligence Agency (DIA) has as many analysts as the CIA has and that
the National Security Agency (NSA) has several times as many analysts, as does
the National Geospatial-Intelligence Agency (NGA), indicating both the breadth
of the IC’s technical collection and its emphasis both on developing analysts who
can interpret secret human or technical intelligence in quick-turnaround pieces
and on countering tactical, asymmetric threats like terrorism.

During the Cold War, however, there was a more balanced analytic focus with
greater emphasis on strategic intelligence issues as a means of outcompeting the
Soviet Union. This kind of analysis deals not only in secrets, but also in myster-
ies—making well-founded but ultimately unknowable predictions about future
actions by acompetitor or adversary. The tradecraft necessary to succeed in stra-
tegic analysis requires substantive regional and topical expertise developed over
the years to supplement experience in the daily collection and understanding
of secrets. Institutionally, it also requires that agencies’ analytic processes be
open to discussion, debate, and dissent because analysts must work together to
describe a probable range of future outcomes and warn about unproven current
threats rather than using the collection to solve a single puzzle with a defin-
itive answer.

Regarding its mission to follow longer-term issues, the IC is falling short in
resourcing and in openness to dissenting opinions, which (if taken seriously) can
help responsible officials respond more effectively to threats and threat actors.
The IC Analytic Ombudsman has expressed concern that hyperpartisanship “has
threatened to undermine the foundations of our Republic, penetrating even into
the Intelligence Community.”*°

For example, the Ombudsman noted in a report on the IC’s handling of elec-
tion-threat analysis in 2020 that, in his view, CIA officials had deliberately
downplayed dissenting views and coordination comments expressed by experts
at the National Intelligence Council and elsewhere who felt there was evidence of
Beijing’s intent to exert at least some influence on the 2020 election as opposed
to the consensus view that Beijing did not interfere in U.S. elections. Senior CIA
analysts and leaders made it “difficult to have a healthy analytic conversation in
a confrontational environment” while violating multiple official IC tradecraft
standards. By not allowing dissents or considering alternatives, the CIA exercised

“undue influence on intelligence.”*” Subsequent exposure of China-linked online

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2025 Presidential Transition Project

influence and the FBI’s warnings about continued efforts through the 2022 mid-
terms highlight the folly of undue certainty without consideration of alternatives.

On election influence and other controversial issues, such as the origin of
COVID-19, analysts at the most powerful intelligence agencies have increasingly
tended to use the leeway they have been given to insert their political views into
their work in order to influence (if possibly even control) the analytic process. They
do this in ways that attempt to squash dissent and impair the creation of a culture
in which entrenched views are challenged and unpopular analytical lines can sur-
vive or not according to their merits.

To help the United States and its leaders to outcompete China across mul-
tifaceted societal, economic, military, and technological threats, the IC’s
capability to conduct strategic intelligence analysis that is relevant to policymak-
ers in both parties must be rebuilt and strengthened. Because Beijing may be a
peer or even exceed U.S. capabilities in some areas, the post-9/11 analytic focus
on quick-turnaround secrets is not good enough. Strategic planning—informed
by intelligence—must take place for the United States to stay ahead of whatever
new threats China may pose.

An incoming conservative President will have the opportunity to signal the
demand for such strategic products and prioritize their production through
communications to intelligence leaders and formal mechanisms such as shifting
priorities within the National Intelligence Priority Framework and structuring the
President’s Daily Brief. The incoming DNI should also emphasize implementing
the recommendations in the Ombudsman’s report, especially regarding objectiv-
ity, the inclusion of dissenting viewpoints, and more serious efforts to hold senior
leaders accountable for backchannel attempts to change or suppress analytic views.

Accounting for the long history of intelligence failures and surprises, an incom-
ing conservative President must appreciate the ambiguity, complexity, limits, and
assumptions inherent in intelligence assessments. Intelligence often deals with the
human dimension in complex decision systems within a foreign country or organi-
zation, and this makes consistently accurate predictions difficult if not impossible
to develop. Seeing something and understanding what you are seeing are two dif-
ferent things, so a President should consistently and patiently press the IC about
its potential biases, assumptions, methodology, and sourcing.

With regard to election-threat analysis and politically controversial topics,
agency leaders should take seriously the Ombudsman’s admonition that we need
to maintain tradecraft standards across all countries and topics by ensuring that
equitable standards apply across all foreign threat actors. Analysis should be put
forward without regard to the domestic political ramifications of intelligence
conclusions.

“Obligation to Share” and Real-Time Auditing Capability. The fed-
eral government has made admirable progress in recent years by being more

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forward-leaning in sharing cyber threat intelligence with private-sector partners

and the public, emphasizing that the protective nature of such information is of
value only if put into the right hands at the right time. Since critical infrastructure

and services are overwhelmingly owned, managed, and defended by the private

sector in the United States, there has been an increasing emphasis on declassify-
ing intelligence and sharing actionable information with private-sector partners,
often through industry-specific Information Sharing and Analysis Centers (ISACs);

regional meetings of government and private-sector experts called InfraGard, run

by the FBI; direct public notification from the Department of Homeland Security,
the FBI, and (increasingly) the NSA; and more discreet one-on-one engagements

led by the collecting agencies.

These programs properly recognize the private sector’s role in providing cyber-
security for Americans; in practice, however, the intelligence shared by the U.S.
government through these venues is too often already known or no longer relevant
by the time it makes its way through the downgrade process for sharing. In addition,
government-shared information often needs to take advantage of the opportunity
to provide contexts, such as attribution, trends, and size of the observed cyber
problem. As warranted, additional context should be provided to the private sector
as a matter of routine.

To continue improving the U.S. government’s ability to defend the country’s
most vital networks, the IC must adopt an “obligation to share” policy process,
including the capacity for “write to release” intelligence products whereby
newly discovered technical indicators, targeting, and other intelligence relevant
to cyber defense are automatically provided either to the public or to targeted
entities within 48 hours of their collection—which is how counterterrorism intel-
ligence has been managed for years when it comes to a “duty to warn.” Under this
policy, agency heads should still have the flexibility to withhold intelligence for
operational or counterintelligence reasons but would need to report regularly
to Congress on the number of and justification for exceptions. This policy would
make sharing intelligence and defending networks the default, as it already is in
the rest of the cybersecurity community outside the IC, to improve the quantity,
relevance, and timeliness of defensive information while ensuring accountability
for top leaders when they must withhold this information.

One of the most significant challenges within the IC is presented by the need to
share information promptly among the 18 elements of the intelligence enterprise.
The only long-term solution to the understandable tension between the need to
share information and the need to protect intelligence sources and methods is a
robust real-time auditing capability that electronically flags unauthorized access.
Under an identity management system with real-time audit, even the most sensi-
tive information acquired by America’s intelligence agencies can be shared, and the
access to and use of that information are appropriately monitored. Establishing

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a real-time auditing capability is essential to decreasing the risk for the heads of
intelligence agencies in meeting their statutory requirements to ensure that they
protect sources and methods associated with the classified information their agen-
cies collect.

Overclassification. There is broad consensus across the U.S. government and
among stakeholders that the system for classifying, declassifying, and otherwise
marking and handling sensitive information is at a crossroads. Exorbitant amounts
of classified data are created daily, and agency personnel often mistakenly choose
classification as the default selection to ensure national security. At the same time,
the effectiveness of downgraded and carefully declassified information to support
foreign policy efforts has been borne out in, for example, alerting the broader world
of Russia’s buildup and likely plans for its invasion of Ukraine.

Two executive orders principally govern how the U.S. government handles clas-
sified and sensitive information.

e Executive Order 13526, “Classified National Security Information,”
issued in 2009,* prescribes the classification levels and procedures for
declassification.

e Executive Order 13556, “Controlled Unclassified Information,” issued in
2010,” aimed to establish a uniform program for managing all unclassified
information that requires safeguarding or dissemination controls.

The current system for declassifying classified national security information
(CNSD) is extraordinarily analog, requiring experts’ review of individual records.
Declassification policies are based on human review of paper and need to con-
template and handle the proliferation and volume of digital records created by
agencies. The U.S. government will soon reach the point at which manual review is
impossible. The declassification of CNSI should support key U.S. national security
objectives, reflect mission priorities, and not serve solely as a necessary procedural
function. Reforms should include:

e Tighter definitions and greater specificity for categories of information
requiring protection.

e More stringent policies to effect significant reductions in the number of
Original Classification Authorities (OCAs).

e Stricter accountability measures at the OCA level and more detailed
security classification guides.

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Mandate for Leadership: The Conservative Promise

e Enhanced metrics for accuracy of classification.
e Ageneral simplification of the overall system for the benefit of users.

On the back end, an ODNI-run declassification process that is faster, nimbler,
default-to-automated, and larger-scale should be a priority.

Additionally, investments in IT are required to deal with the growing volumes
of CNSI collected and produced in the digital age, along with many years’ worth of
existing analog and digital holdings that could provide valuable historical insights.
An incoming Administration needs to explore options to prioritize funding for
innovation in declassification management: for example, by establishing a budget
line item specifically for the modernization of declassification or designating fund-
ing for program classification management as a special-interest item.

The Administration will also need to transition to using technology, including
tools and services for managing Big Data (which provide a robust electronic record
repository, making information within and across agencies easier to organize and
locate and facilitating more rapid review and release capabilities for records of
emerging interest); artificial intelligence/machine learning (which, when incor-
porated into existing business practices, enables machine interpretation of
unstructured text and data, applies decision support technology to enable more
consistent classification decisions, and expedites reviews between agencies); and
expansion of Commercial Cloud services (which facilitate the rapid testing and
deployment of new tools and technologies).

However, technology is not a panacea; human expertise in information holdings
and routine validation of the technology will always be necessary. With or with-
out machine assistance, agencies will require more people and more varied skill
sets to improve their ability to meet the electronic records era’s classification and
declassification demands and serve an incoming Administration’s goals.

Broader U.S. Government and IC Intelligence Needs. Increasingly, con-
flicts among U.S. adversaries such as China, Russia, Iran, and North Korea are
conducted in the realms of technology and finance.*° This challenge requires new
tools, authorities, and technological expertise across the U.S. government, par-
ticularly at the Commerce Department’s Bureau of Industry and Security (BIS)
and the Committee on Foreign Investment in the United States (CFIUS), which
is housed at the Treasury Department.

An incoming conservative President should task his DNI and Secretary of
Commerce with increasing coordination, the resources needed for BIS and SCIF
capacity, and proper and necessary intelligence sharing to counter the activities of
multifaceted adversaries such as China. This would include additional work with
private-sector expertise, granting clearances to niche sector experts and United
States citizen commercial and financial partners as needed.

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2025 Presidential Transition Project

Cover in the Digital Age. Even in the public domain, it is becoming increas-
ingly clear that protecting the identities of undercover intelligence officers is
difficult in the digital age.” The truth is that as our daily activities are conducted
predominantly in the digital domain, our antiquated system for providing cover to
undercover officers has lagged woefully behind the threat from foreign adversaries.

The DIA, CIA, and FBI are increasingly aware of this threat and are devoting
resources to the problem. Their back-office infrastructure, however, is such that
they are still using methods for providing cover from decades past that put valuable
intelligence officers at unnecessary risk. How intelligence officers and their fami-
lies are taught to use smartphones and social media, travel, conduct banking, and
take and share pictures—even how and when they are paid—can make it difficult
to protect identities.** Legends, fake backstories, and identities are often weak,
incomplete, and unable to stand up to a basic Google search.*® Officers operat-
ing under nonofficial cover are offered even less protection and training to help
them succeed.

In addition, ubiquitous technical surveillance (UTS) techniques being refined by
technologies emanating from the regimes in China and Russia will continue to be
highly challenging for intelligence officers. An incoming Administration will need
to double down on resourcing and training so that members of the IC will have the
expertise they need to operate clandestinely (and successfully) against hard targets.

Privacy Shield. For many years, the European Union (EV) has tried to force U.S.
companies operating in Europe to follow its data privacy regulations. Misleading
claims in the 2013 Snowden leaks destroyed the initial Safe Harbor Framework**
that allowed American companies to transfer data across the Atlantic; its succes-
sor, the Privacy Shield Framework, was struck down by European courts on the
grounds that it provides insufficient protections for EU citizens against hypothet-
ical U.S. government surveillance. Those same European courts exempted the
intelligence services of EU member states from the standards applied to the U.S.,
suggesting that trade protectionism may be the real motive behind data privacy
regulations.

In 2022, the Biden Administration negotiated a new agreement, the Trans-At-
lantic Data Privacy Framework,* intended to withstand European legal challenges.
Given the fate of its predecessors, it is not certain that it will survive. Executive
Order 14086, “Enhancing Safeguards for United States Signals Intelligence Activi-

”47 implements this new framework by attempting to align signals intelligence

ties,
collection practices with European privacy regulations. At most, the executive
order’s changes will be helpful support for the framework in future European
litigation; at worst, they could throw sand in the gears of important intelli-
gence programs.

An incoming conservative President should reset Europe’s expectations. Brus-

sels has always arbitraged the difference between being a military ally against, for

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Mandate for Leadership: The Conservative Promise

example, Russia and conducting a full-blown trade conflict with the United States.
Restrictions on data exports have been part of the trade conflict, but now they could
seriously harm our military and intelligence capabilities. Moreover, restrictions
on U.S. intelligence collection hurt the Europeans themselves, especially as the
United States shares unprecedented amounts of intelligence on Russia’s invasion
of Ukraine with Europeans.**

Europe is telling the United States to meet intelligence oversight standards
that no European country meets. At the same time, exports of data to China are
unexamined and (so far) free from legal challenges. That violates World Trade
Organization agreements as an arbitrary and discriminatory data protection stan-
dard. It is a betrayal by a nominally allied jurisdiction. European court rulings that
struck down prior data privacy frameworks were grounded not in constitutional
law but in a treaty among European nations. If the EU accepted an international
agreement that data may flow to the United States under a more reasonable stan-
dard than the one adopted by the court, that interpretation would be binding, at
least as a gloss on the earlier treaty.

The United States has never seriously pushed back against the EU; now is the
time. An incoming President should ask for an immediate study of the implemen-
tation of Executive Order 14086 and suspend any provisions that unduly burden
intelligence collection. At the same time, in negotiations with the Europeans, the
United States should make clear that the continued sharing of intelligence with
EU member states depends on successful resolution of this issue within the first
two years of a President’s term. It is time for a real solution, not the 30 years of
stopgaps imposed by Brussels.

President’s Daily Brief (PDB). An incoming conservative President should
make clear what the President’s Daily Brief is and is not. The PDB should be for
the President specifically, with a much narrower distribution and addressing areas
of strategic concern. During the transition, the future National Security Advisor,
along with the DNI, should conduct a review of current PDB recipients and deter-
mine which should remain recipients when the President’s term begins.

Instead of being used as the statement of record for the agencies, the PDB often
misses the areas of interest for Presidents and their senior advisers. The President
should want the PDB to focus on providing the information needed for the often
imperfect and complex decisions that a President needs to make, which should
always be based on the best intelligence that can be gathered. Where consensus
and agreement are possible, an IC-coordinated product is excellent, but insights
provided by properly channeled dissent can lead a President to ask relevant ques-
tions of his DNI and IC.

A future DNI determines the PDB briefer based on recommendations made by
the Deputy Director of National Intelligence for Mission Integration (MI). His-
torically, briefers have come from the CIA, but a future President and DNI should

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2025 Presidential Transition Project

consider a primary briefer or a rotation of briefers from other IC elements. Addi-
tionally, the entirety of the PDB staff and production should be located at ODNI.

National Intelligence Council (NIC). The National Intelligence Council is
the IC’s premier analytic organization and includes more than a dozen National
Intelligence Officers (NIOs), each of whom leads the IC’s analysis within a regional
(China, Russia, Iran, etc.) or functional (cyber, counterproliferation, economics,
etc.) mission area. This includes authoring National Intelligence Estimates on
major strategic issues with the entire IC, overseeing and deconflicting the annual
analytic plans of each agency, and weighing in on day-to-day major analytical issues,
sometimes individually (for example, by writing the NIC’s strategic memos or pro-
viding detailed expert briefings to the President before major decisions).

Historically part of the CIA, the NIC was reorganized into the ODNI as was
the PDB. It retains the CIA’s objective analytic culture and is staffed primarily
with CIA officers; however, as many as 25 percent of its NIOs over the decades
have come from academia or the private sector, bringing in much-needed outside
expertise to collate and understand intelligence with perspective and skills that
are not necessarily nurtured within the IC. In recent years, there has been a greater
emphasis on encouraging officers from other agencies—particularly the DIA, NSA,
and FBI—to serve as NIOs or as their deputies.

To encourage greater analytic independence and debate, the incoming Admin-
istration should require that non-CIA officers comprise at least 50 percent of the
NIC’s membership and that the first-among-equals NIC Chairman is an outsider
from one of the three major IC agencies with reporting responsibility to the PDDNI.
Opening these senior analytic roles to the best analysts regardless of agency would
also encourage the continued maturation of analytic cadres and tradecraft at those
agencies and give them an equal voice in interagency analytical disputes, which in
turn would give the President access to the best thinking and a variety of sources
and perspectives from across the entire IC rather than from the CIA alone.

IC Chief Information Officer. The Intelligence Community Chief Informa-
tion Officer (CCIO) directs and oversees all aspects of the classified IT budget for
all of the IC’s 18 elements. As the DNI’s principal adviser for technology, the ICCIO
must be well-versed in technology, acquisitions, operations, and intra-agency coop-
eration to advance our technical prowess and simultaneously direct a bureaucracy
that, left unchecked, will serve each element’s own preferences. To ensure that
procured and implemented technology and policy reflect the Administration’s
agenda, the ICCIO must have the support of the DNI and possess the ability to
command cooperation between and promote interoperability across IC members.

Because of the unique responsibilities entrusted to this position, incumbency
has seesawed between political appointees and career civilians; due to its con-
gressionally capped salary, the position is often filled by an SES-level member
administratively detailed to support the DNI. At times, the ICCIO is incorrectly

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Mandate for Leadership: The Conservative Promise

referred to as the ODNI CIO. By law, and to secure unbiased execution across all of
the IC’s 18 elements, the same individual may not serve as ICCIO and ODNI CIO.
They are two distinct positions.

Critical areas and IC IT portfolio priorities for the ICCIO include but are
not limited to:

e Transparent accounting and allocation of IT investments across the IC,
including commercial cloud computing and storage (C2E);

e Recognized and uniform security access for people, systems, and capabilities
to enable interoperability across IC elements;

e 5G/6G data transmission and network interoperability, which is vital to IC
element operations;

e Artificial intelligence and machine learning;
e Quantum cryptography and post-quantum encryption (PQE); and

e Cybersecurity infrastructure where Biden Administration changes have
realigned and reassigned management oversight and IT architecture
responsibilities to NSA and DHS/CISA, conflicting with ICCIO-
delineated roles.

An incoming Administration should appoint the ICCIO as a primary member
of the DNI staff along with the ODNI General Counsel, IC Chief Financial Officer,
and ODNI Chief Operating Officer.

The President-Elect should require immediate reviews of the progress in imple-
menting post-quantum encryption at a minimum for IC and Defense systems but
preferably throughout the government. The President’s National Security Memo-
randum specifying “the goal of mitigating as much of the quantum risk as is feasible
by 2035”*° needs to be revised in light of the magnitude of the threat. Accounting
for the investment that will be needed to secure IT systems for national security
should be a top priority.

ODNI, CIA, and IC Technology Issues. In recent years, the IC has hada
mandate from multiple Administrations to advance technology needs for intelli-
gence—needs that have seen massive changes as a result of such threats as China’s
advancements in technology and data infrastructure. Many of the projects coming
out of ODNI and CIA’s Science and Technology Directorate (S&T) focus on expen-
sive, AI-driven open-source work, but there is likely duplication of effort in areas
where the private sector and entrepreneurs are already making progress.

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2025 Presidential Transition Project

The Intelligence Advanced Research Projects Activity (ARPA) and S&T should
focus primarily on challenging technology problems. Avoiding duplication of what
is already being done well in the private sector in such areas as practical defense
cyber intelligence and artificial intelligence research would help to focus the agen-
cies on the complex shadow tasks at hand while simultaneously freeing limited
resources for advancement in other areas.

President’s Intelligence Advisory Board and PIAB Intelligence Oversight
Board. The President’s Intelligence Advisory Board (PIAB) is charged with pro-
viding the President with an independent source of advice on the IC’s effectiveness
while offering insights into the IC’s future plans. The Board is meant to have access
to all information needed to perform its functions and to have direct access to the
President. The Intelligence Oversight Board is a standing committee within the
PIAB. These entities should be tasked with giving independent, informed advice
and opinion concerning major matters of national security focused on long-term,
enduring issues central to advancing and protecting American interests. This
should include taking a broader, deeper look at critical trends, developments, and
their implications for U.S. national and economic security relying on unclassified
and open-source information.

The Importance of Space. With China developing increasingly capable space
and counterspace technologies and Russia taking more aggressive action in space,
space has emerged as the latest warfighting domain. In response, the DNI cre-
ated the Office of the Space Executive (OSX) in 2018 as an experiment to promote
greater integration of IC space activities without incurring excessive overhead.
The DNI mandated greater collaboration across the enterprise without adding
personnel, altering authorities, and increasing budgets.

The Space Executive’s design reflects the original design principles of the ODNI.
The ODNI was explicitly not designed to be a departmental headquarters with com-
mand and control of the 18 agencies’ vast bureaucracies. Rather, it was designed
to be small and lightweight with a mission to coordinate and integrate the criti-
cal activities of the IC’s 18 agencies without creating new bureaucracy. That goal
should remain in force, and calls by outside entities or Congress to add new centers
and layers should be rejected.

The Office of the Space Executive has been recognized as an effective governance
model and has spawned similar efforts, including the Election Threats Executive,
Economic and Threat Finance Executive, and Cyber Executive. With this in mind,
the following initiatives should be pursued:

e Expand collaboration with partners. For too many decades, the
IC and DOD have acquired and operated satellites independently. To
improve their ability to meet the threat posed by China and Russia, the IC
and DOD should:

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Mandate for Leadership: The Conservative Promise

1. Explore new methods for better integrating our space assets,
2. Examine the possibility of joint programs, and

3. Fully utilize unique Title 10 and Title 50 authorities to execute space
defense (and offense) strategies jointly.

Additionally, the IC should support building international alliances with
like-minded partners beyond the Five Eyes intelligence-sharing nations.
Increasingly, potential allied nations (and their commercial companies) are
developing innovative space capabilities to augment and strengthen the U.S.
space defense and intelligence posture.

Refocus space-related intelligence collection. The IC has developed a
space threats collection posture predicated on three assumptions:

1. The best information on developing space threats comes from collection
against the adversaries’ military institutions on Earth,

2. There should be a clear dividing line between DOD’s intelligence
activities and the IC’s, and

3. Only government-developed “exquisite” capabilities can inform threat
analysis and decision-making effectively.

Developments by our adversaries and the emergence of a vibrant
commercial space marketplace over the past decade have rendered all three
assumptions false and even dangerous. The IC must therefore refocus and
invest in methods that will enable it to characterize accurately the threats
that already exist in space, not just on the ground; break down barriers

to information sharing and collaboration with the DOD; and embrace
commercially derived capabilities that can be adapted to a national security
mission—all while emphasizing the need to protect critical supply chains
and the cybersecurity needs that result from an increasingly government-—
commercial low Earth orbit.

Our nation’s economic and national security depends on being able to

advance America’s leadership position in space, which is eroding in the face
of increasing threats from adversaries and our own inaction.

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2025 Presidential Transition Project

AN UNFINISHED EXPERIMENT

The Intelligence Community, including specifically the role of the DNI and
ODNL, is an unfinished experiment. The envisioned design principle was a conser-
vative one: a small, network-centric model for enterprise coordination as opposed
to a large monolithic bureaucracy like DHS. The ODNI, however, has reverted
in some ways to a bureaucratic and hierarchical model characterized by limited
effectiveness.

Historically, the CIA has undercut the DNI and maintains primacy in the IC
hierarchy, especially regarding the White House. An incoming conservative Pres-
ident can right the ship and return the IC governance model to first principles
by using a limited but empowered leadership and coordination design to serve
the nation’s intelligence and national security needs while reclaiming the public
trust with fiscal responsibility, political neutrality, personnel accountability, tech-
nological prowess, and necessary human capital needed to counter the immense
nation-state and asymmetrical threats facing our country.

AUTHOR’S NOTE: [he preparation of this chapter was a collective enterprise of individuals involved in
the 2025 Presidential Transition Project. No particular policy statement, reform recommendation, or other view
expressed herein should be attributed to any individual contributor or to the author.

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Mandate for Leadership: The Conservative Promise

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efing-room/statements-releases/2022/05/04/national-security-

tum-computing-while-mitigating-risks-

t=To%20mitigate%20this%20risk%2C%20the%20United%20
easible%20by%202035 (accessed

arch
Enhancing the National Quantum Ini
0. 89 (May 9, 2022), pp. 27909-279

2, 2023).
iative

1, https://
‘and “Fact

House, May 4, 2022, https://www.whitehouse.gov/briefing-roon
sheet-president-biden-announces-two-presidential-directives-advancing-quantum-technologies/ (accessed

March 12, 2023).

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n/statements-releases/2022/05/04/fact-

MEDIA AGENCIES

U.S. AGENCY FOR GLOBAL MEDIA

Mora Namdar

MISSION STATEMENT

The mission of United States Agency for Global Media (USAGM) is to inform,
engage, and connect people around the world in support of freedom and democ-
racy.' However, this mission statement does not reflect the current work of the
agency. The mission is noble, but the execution is lacking. To fulfill its mission,
USAGM should also aim to present the truth about America and American policy—
not parrot America’s adversaries’ propaganda and talking points.”

OVERVIEW

Originally formed as the Broadcasting Board of Governors (BBG) in 1994, the BBG
changed its name in 2018 to the United States Agency for Global Media. The USAGM is
asub-Cabinet agency of the U.S. government with a budget of just under $1 billion. The
agency oversees two government broadcasting networks: the Voice of America (VOA)
and the Office of Cuba Broadcasting (OCB). USAGM also oversees 100 percent of the
grant funding for several “independent” grantee organizations, including the Middle
East Broadcasting Network (MBN), Radio Free Asia (RFA), Radio Free Europe/Radio
Liberty (RFE/RL), and the newly formed Open Technology Fund (OTF).?

e The Voice of America provides news and information in 48 languages to
a weekly audience of more than 326 million people worldwide. For more

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than 80 years, VOA journalists have supplied news and information about
the U.S., audience-specific regions of interest and concern, and the world at
large. VOA radio and television signals are broadcast to approximately 3,500
affiliates, and satellite transmissions reach countries where free speech is
banned or where civil society is under threat.*

VOA uses digital, web, and mobile media as well, which, while sometimes
useful in propagating valuable information globally, has created specific
violations of the agency’s prohibition against broadcasting to the domestic
U.S. audience—particularly with regard to flagrantly political content, as
has been the practice with recent and current VOA content directors and
managers. The network once had a generally well-received brand value,
but it has deteriorated under decades of poor leadership and a loss of its
once-prized unbiased reporting. There are bright spots within VOA, but
mismanagement and declining production values have diluted its once-
great reputation as a singular voice in American news broadcasting abroad.

The Office of Cuba Broadcasting oversees Radio and Television Marti, a
multimedia hub of news, information, and analysis that provides the people
of Cuba with programs through satellite television, radio, and digital media.
These programs present news and information about Cuba’s oppressive
government from the outside world that would otherwise be heavily
restricted.° The OCB remains a critical avenue of truth to the Cuban people
but has been threatened with crippling budget and operational constraints,
including empathetic attitudes toward Communist Cuban leadership
coupled with organizational hostility toward the OCB by certain elements
of USAGM leadership. During the Biden Administration, the OCB has been
threatened with closure, while also suffering chilling reductions in force.’

The Middle East Broadcasting Network is an Arabic-language news
organization with a weekly audience of 27.4 million people in 22 countries
in the Middle East and North Africa. The MBN consists of two television
networks, radio, websites, and social media platforms. Together, they deliver
news and analysis on the region, American policies, and Americana. The
MBN has correspondents throughout the Middle East and North Africa.®

Radio Free Europe/Radio Liberty is a private, nonprofit, multimedia
broadcasting corporation that serves as a surrogate media source in 27
languages and 23 countries, including Afghanistan, Iran, Pakistan, Russia,
and Ukraine.

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Founded in the early days of the Cold War (Radio Free Europe in 1949

and Radio Liberty in 1953) and merged in 1976, Radio Free Europe and
Radio Liberty were intended to execute edgy and daring information
operations and unrestricted news reporting deep behind the Iron Curtain.
Unfortunately, like other broadcast organizations under USAGM, RFE/RL
has surrendered much of its rich history to an approach that favors political
trends as opposed to operations that support and represent America abroad.
While there are some bright spots within RFE/RL, much of the network has
redundant programming with certain VOA language services, often with
competing, counterproductive, or dissimilar messaging.

The recent addition of RFE/RL’s Hungarian-language service, Szabad
Europa, falls outside the intended scope of RFE/RL’s charter by targeting a
democratically elected, pro-American European and NATO ally.

Not least, RFE/RL has been plagued by several serious espionage-related
security risks within its ranks.’

Radio Free Asia is a private, nonprofit multimedia news corporation that
brings news and uncensored content to people in six Asian countries that
restrict free speech, freedom of the press, and access to reliable information.
RFA also provides educational and cultural programming, as well as forums
for audiences to engage in open dialogue and freely express opinions. RFA
utilizes on-the-ground reporters and networks of in-country sources, citizen
journalists, and eyewitnesses who provide leads, tips, images, and video.’°

Several reports from the Office of the Inspector General (OIG) were released
showing waste and self-dealing, including security vulnerabilities and RFA lead-
ership awarding insiders millions of dollars of grant funding." For example, as
the OIG stated in one report, the then-president of RFA “established the Free-
dom2Connect Foundation (Foundation)” and thereafter “awarded two contracts,
totaling $1.2 million” to the foundation she herself founded.” Furthermore:

[The] OIG found that RFA did not comply with Federal procurement
requirements for grantees. OIG identified instances in which RFA and
its agents did not comply with OMB [Office of Management and Budget]
conflict-of-interest procurement requirements for grantees. Specifically,
OIG found that RFA entered into 14 contracts, totaling $4.0 million

(51 percent of the amount of OTF FYs 2012 and 2013 project-related
contracts), with organizations that had some affiliation with either RFA
officials or members of OTF Advisory Council.”

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This same leadership proceeded to wastefully form the Open Technology
Fund as its own independent grantee with the help of USAGM senior
management prior to the tenure of Trump-appointed leadership.

The Open Technology Fund’s goal is to provide funding to support
the research, development, and implementation of Internet freedom
technologies that circumvent censorship. OTF was formed under dubious
circumstances by using consolidation rules to usurp the mission and
funding of USAGM’s pre-existing Office of Internet Freedom (OIF), which
funded far more diverse technologies with much greater transparency. OTF,
however, operates with far less transparency and strictly restricts funding to
“open source” technology. OTF does not support any technology with even
partially “closed source” code, notwithstanding that such closed-source
code would provide more protection against hacking.

Although OTF touts large user numbers, this could not be substantiated
upon requests for information, and it was discovered by former senior
USAGM leadership that OTF makes extremely small, insubstantial
donations to much larger messaging applications and technology to bolster
its unsubstantiated claims.“ Despite its vibrant self-lobbying and publicity
efforts, OTF remains a wasteful and redundant boondoggle. Its grantee
status was suspended by Trump-appointed USAGM leadership for a number
of reasons, including noncompliance with its grant terms and for actions
that resulted in several fraud and waste investigations.”

The OIF, which predates OTF, was historically under USAGM’s Office of
Chief Strategy Officer and for years had been performing the same tasks as
OTF within USAGM headquarters for the benefit of all USAGM broadcast
networks. With much greater transparency, OIF succeeded with fewer staff
while simultaneously fielding more diverse and robust technologies. Absent
a meaningful organizational impact analysis to justify the wastefulness of
the decision-making process, OTF usurped the entire OIF budget and was
set up as anew grantee organization.

Exacerbating matters, OIF was shut down in order to provide massive
grants to the opaque activities of OTF and its founding leadership, who went
on a free-spending boondoggle for high-end Washington, D.C., office space,
furnishings, and top salaries for its leadership team. Numerous career staff
whistleblowers came forward to sound the alarm about OTF to Trump-
appointed leadership, citing concerns about the OIG reports, wasteful
spending, and other substantive performance matters.’® Nonetheless, the

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Biden Administration reinstated OTF to full operational status and ceased
all investigations immediately after assuming office.

ATTEMPTS AT REFORM

Late in the Trump Administration, following the long-delayed Senate confirma-
tion of Michael Pack as USAGM Chief Executive Officer (CEO),” agency leadership
rapidly initiated long-overdue and necessary reforms,'* including security reforms
repeatedly requested by the Office of Personnel Management (OPM) and the Office
of the Director of National Intelligence (ODNI) that had been ignored by USAGM
leadership.”? Unfortunately, as was the case with the OTF, the Biden Administration
immediately reinstated personnel who had been fired for gross security violations,
placing the agency back into its previously failed posture—one that poses a danger
to national security.

The Firewall Saga. The vital error in USAGM’s current organizational/cul-
tural calculus is the agency’s selective application of a journalistic “firewall.” The
amorphous interpretation of a firewall shifts, depending on which Administration
is in office and who is asking questions.

Although a firewall should ensure journalistic independence, it has been used
without formal regulation for decades in order to shirk legitimate oversight of
everything from promoting adversaries’ propaganda to ignoring journalistic safety.
Often, the “firewall” is touted when journalists are either promoting anti-American
propaganda that parrots adversarial regime talking points or promoting politically
biased viewpoints in opposition to the VOA charter.”°

Such weak oversight, alien to any other large media network or news organi-
zation—particularly one derivative of U.S. foreign policy and national security
goals—was erroneously enshrined in a document known as the Firewall Regula-
tion.”’ The Firewall Regulation was entered into the Federal Register on the eve
of the Senate confirmation of President Donald Trump’s USAGM CEO, Michael
Pack. It was the quintessential “midnight reg” designed to throttle the statutory
and executive authority of the agency head. It stipulated that agency management,
by standards unknown to most large broadcast companies, was forbidden from
engaging in oversight and direction of content in any way—even false content.
It ran counter to the law, including the Smith-Mundt Act,” and it was harmful
to the agency itself and to the foreign policy and national security goals of the
US. government.

Even content that went well beyond fair and accurate reporting on U.S. domestic
and political problems could not be reined in by front office leadership under the
Firewall Regulation. Soon, VOA’s White House correspondent was posting content
highly critical of, and personally insulting to, the U.S. President—in contradiction
of VOA’s own journalistic standards, policies, and procedures. USAGM career offi-
cials considered such content sacrosanct and bravely independent “journalistic”

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content protected by the “spirit of” the Firewall Regulation—despite ample evi-
dence to the contrary.

Late in the Trump Administration, USAGM political leadership, following an
intensive U.S. Department of Justice review, revoked the Firewall Regulation over
the protests of journalistic organizations—none more vociferous than VOA itself.”
While the abuses of the Firewall Regulation are particularly disconcerting, they
encompass just a fraction of similar overreaches of the agency’s journalistic mission.

Current and former USAGM/VOA leadership who wanted to maintain virtually
zero accountability and oversight waged a campaign of interference, resistance, and
disinformation to stifle change at the agency. Perhaps not coincidentally, various
media outlets with relationships to former and future USAGM leadership published
near-daily criticisms of Trump Administration appointees and also of grantee organi-
zation leaders who were appointed by CEO Pack to implement long-overdue reforms.”*

Agency Mission Failure. Currently, the USAGM, by and large, is not fulfilling
its mission, which remains so ill-defined and ambiguous that it enables the organi-
zation to go about its business largely unguided with little to no oversight. Rather
than providing news and information in an accurate, reliable way that promotes
and supports freedom and democracy, the agency is mismanaged, disorganized,
ineffective, and rife with waste and redundancy.

These shortfalls are either oriented toward, or directly contribute to, the agen-
cy’s media organizations joining the mainstream media’s anti-U.S. chorus and
denigrating the American story—all in the name of so-called journalistic inde-
pendence. Indeed, content during the Trump Administration was rife with typical
mainstream media talking points assailing the President and his staff. The few
bright spots within VOA and the OCB are often stifled instead of supported. Top-
level talent often leaves the agency or is met with obstacles rather than support.”
Opportunities for modernization and effective strategy are ignored, and wasteful
spending and misallocation of resources are the norm in an environment in which
nepotism is rampant and political gamesmanship protects bad actors.

Amanda Bennett” was confirmed as USAGM CEO in 2022 after two years
of being blocked by several Members of Congress. Legal advocacy organization
America First Legal Foundation even wrote to President Joe Biden asking him to
withdraw her nomination,” citing several severe national security failures while
she was director of VOA.”* Her tenure as director during the Obama Administration
(and her holdover into the beginning of the Trump Administration) was marred
with operational failures, security failures, and credibility failures. Those failures
are reportedly ongoing during her current tenure as CEO.”

NECESSARY REFORMS

Security Issues. The Office of Personnel Management® and the Office of
the Director of National Intelligence flagged severe security failures during four

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extensive investigations of the USAGM, each conducted during a 10-year period
between 2010 and 2020.*! Security personnel and former agency senior leadership
ignored these issues and allowed them to persist.*

In brief, the USAGM is vulnerable to exploitation by foreign spies. During the
last six months of the Trump Administration, known foreign intelligence opera-
tives were removed from the OCB and RFE/RL. During the 10-year period between
2010 and 2020, both the OPM and the ODNI found that the USAGM’s Office of
Security (under the Office of Management) had grossly ignored and flouted many
of the federal government’s most critical and long-standing information and per-
sonnel security protocols, regulations, and practices.

During the investigative period—in which the findings were largely, if not
wholly, ignored by agency senior leadership—over 1,500 USAGM personnel
(nearly 40 percent of its total workforce) were performing their Tier 3 and Tier 5
national-security-sensitive positions with falsified and/or unauthorized suitabil-
ity-for-employment determinations and with access to sensitive federal buildings
and information systems. In many cases, records (including Social Security num-
bers), were falsified or replaced with notional placeholders, and fingerprints (in
many dozens of cases) were never submitted to the Federal Bureau of Investigation
for basic background investigations.

By the time these issues were addressed by members of the Trump Adminis-
tration, more than 500 personnel with unauthorized access and clearances had
left the USAGM and rolled into other federal agencies with reciprocal clearance
authorizations. Many others disappeared into U.S. society. As of January 2021, the
USAGM had not yet determined the whereabouts of these individuals.**

The USAGM must never again be entrusted with delegated authority over its
personnel security programs and suitability determinations until such time as it
can prove that these failures will not happen again. These responsibilities must
remain with the Department of Defense and the Office of Personnel Management,
to which they were transferred in the final weeks of the Trump Administration.

Journalists’ Security. Agency journalists, both on and off American soil, have
faced danger,® yet their superiors have done little to protect them. Whistleblowers
and Trump Administration officials found that protection of USAGM American
and foreign journalists employed by USAGM networks and grantee organizations
was severely lacking.

Against often-significant resistance, political appointees forced action to
enable broadcasters (who were under verified threats) to broadcast from remote
locations while being protected by federal law enforcement officers. Likewise,
political appointees met resistance from senior career officials when insisting
that foreign-based journalists in high-risk countries make their locations known
to the agency in the event they required rescue, extraction, or safe housing. Such
safety measures, argued career officials, would somehow represent a violation of

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journalistic independence. With only rare exceptions, resistance to the most basic
journalist safety measures was the knee-jerk response from USAGM career officials.

Wasting Taxpayer Dollars. The USAGM’S current operations, properly man-
aged, can be conducted on less than $700 million per year. Prior to the arrival of
President Donald Trump’s appointees in June 2020, budgeting, financial responsi-
bility, and spending totaled over $800 million per year, with virtually no oversight
or supervision. Waste, unnecessary spending, nepotism for pet projects, redundant
programs, and unnecessary hiring abounded.

Consolidation and Reduction of Redundant Services. Currently, the USAGM
funds numerous redundant services through its own offices, through Voice of Amer-
ica and the Office of Cuba Broadcasting, and through its grantees. For example, VOA
has a Mandarin-language service but also funds redundant services through Radio
Free Asia. VOA also has a Farsi-language service that duplicates one funded through
Radio Free Europe/Radio Liberty. Surplus services in the same languages are often
unnecessary and counterproductive. Fiscal responsibility and transparency should
return to the USAGM, with consolidation being a cornerstone of the strategy.

As noted previously, the Open Technology Fund duplicates activities that
already existed at the USAGM in the Office of Internet Freedom. Numerous career
whistleblowers came forward to sound the alarm to President Trump’s USAGM
political team about OTF’s abuse and overreach.* Its opaque, expensive, and
unnecessary usurpation of an existing USAGM office is an egregious example of
government waste and illustrates the general disdain for U.S. taxpayers that is rife
within this agency. Full reinstatement of OIF would allow full agency and congres-
sional oversight into how so-called “Internet freedom” money is being spent.*”

J-1 Visa Program Abuses. Rather than use the appropriate I visa** intended
for foreign journalists, the USAGM uses the J-1 “cultural exchange” visas to allow
foreign nationals to transition easily into jobs that American citizens with cul-
tural and linguistic expertise could satisfy. The J-1 visa is intended for cultural and
academic exchange programs, among others—none of which include journalism.”
Additionally, J-1 visas are meant for non-immigrant temporary exchanges. The
USAGM’s J-1 visa holders often go on to apply for permanent residency, which
violates the intention of this visa.

Shortwave Transmission Upgrades and Improvements. Non-web-based
technologies that are proven and durable, such as shortwave radio transmission
stations, have been grossly deemphasized in budgeting in favor of newer web-
based technologies. This move is dangerously short-sighted and puts the U.S. at a
perilous strategic disadvantage in the event of a major conflict, particularly with
Russia or China.

There is great concern about the vulnerability of undersea cable trunks that
make up the Internet cloud. The vast majority of global Internet traffic—95 per-
cent—is transmitted through these cables, including news transmissions and

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web-based content produced by the USAGM’s broadcast networks. While the

robust and popular use of the Internet is ideal during peacetime, during times of
major conflict, widespread damage to the undersea cables that carry communi-
cations across the globe can reasonably be expected. Long-lasting power outages

are also likely, such as those Ukraine experienced in the aftermath of Russia’s

2022 invasion.

The USAGM’s responsibility for the only U.S. global shortwave radio capability is
of critical strategic importance if America is to carry its message to people seeking
information and freedom within conflict zones. Shortwave technologies also make
it possible to carry broadcasts in areas where Internet traffic is severely restricted,
as itis in many authoritarian states today.

ORGANIZATIONAL ISSUES

Personnel. Personnel is one of the biggest concerns for the USAGM and its
grantees. Attracting talented staff who will stay and letting go of poorly perform-
ing personnel are hurdles. Additionally, whistleblowers have come forward with
numerous credible allegations of illegal nepotism and improper hiring practic-
es.*° Past agency leaders have ignored national security procedures when hiring
and have failed to adequately vet staff.* Government hiring policies and federal
law must be followed, and serious policy changes must be implemented to end
these practices.

Relevant Government Entities

e The White House. As an executive branch agency, the USAGM ostensibly
should report to the President and coordinate activities with the
National Security Council (NSC)—especially given the direct and implied
national security aspects of the agency’s messaging globally. However,
there currently is no specific office in the White House or NSC liaison
for the USAGM.

The original network, VOA, functioned under the Office of Coordinator

of Information as early as 1941, the War Department’s Office of War
Information from 1942 to 1945, the State Department from 1945 to 1953,
and the U.S. Information Agency from 1953 until the creation of the
independent Broadcasting Board of Governors in 1999, Although some
oversight and management functions of the agency are provided by the
State Department, the USAGM otherwise has little connectivity to larger
departments or agencies and even less to the White House. With the
dissolution of the U.S. Information Agency in 1999, the USAGM has virtually
been under its own supervision and guidance. The results have been dismal.

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The State Department. VOA was most effective before and during the

Cold War when it was under the direct supervision and control of the War

and State Departments, respectively. If VOA is not put in the direct chain of
command under the NSC, serious consideration should be given to putting
VOA under the direct supervision of the Office of Global Public Affairs at the
Department of State. The Office of Global Public Affairs was formed during
the Trump Administration by consolidation of the State Department’s Bureau
of International Information Programs and Bureau of Global Public Affairs.

Ensuring that taxpayer-funded TV, radio, and messaging tells America’s
story is imperative and should be coordinated with the existing foreign-
language social media platforms at the State Department. Currently, VOA’s
foreign-language TV programming is unreliable in telling America’s story,
given its amorphous interpretation of its independence firewall and its
waning adherence to certain provisions of the Smith-Mundt Act depending
on which political party is in office.

The VOA firewall is meant to protect broadcasters from government
interference with content; however, USAGM staff have abused the firewall
and used it as an offensive measure to block oversight. Additionally, the
Smith-Mundt Act stipulates that USAGM services are meant to tell the
American story abroad—never to domestic audiences—but the agency has
used its taxpayer funding to promote partisan messaging in the U.S. One of
the most egregious examples was when, in 2020, it bought ads on its foreign-
language social media sites to disseminate a Biden campaign ad and targeted
it to amajor Muslim population in Michigan.” Moreover, VOA often airs
foreign adversaries’ propaganda, which is antithetical to its congressionally
mandated core mission. State Department oversight or “command” may be
one way to ensure that VOA and the rest of the USAGM returns and adheres
to its original mission.

Clear lines of command and communications between the USAGM and an
appropriate office of the National Security Council are also sorely lacking,
as has been any reasonable accountability for USAGM senior leadership
and strategy. The State Department’s Assistant Secretary for Global Public
Affairs and Undersecretary for Diplomacy and Public Affairs should also

be in the accountability loop for agency actions. While the U.S. Secretary of
State technically has a seat on the board of the agency, it is a toothless seat
that is often deferred to the undersecretary and/or assistant secretaries
noted above. This position should be relevant and directive when U.S.
foreign policy and strategic communications are at stake.

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For example, the years-long delay in confirming the Trump-appointed

CEO left disastrous holdover leadership from the previous Administration.
Employing effective leadership, even in an acting capacity, while anew CEO is
awaiting Senate confirmation is necessary to prevent a repeat of this behavior.

e Congress. The USAGM receives its budget and mandates directly from
Congress. Often, changes in major functions at the agency happen because
of the lobbying efforts of a few connected individuals—often grantees
lobbying for more funds and less accountability. Those changes can and
do handcuff leadership from any meaningful oversight. An overhaul of the
agency with review from Congress to modernize, streamline, and reduce
waste must be done with congressional support.

e Key nongovernmental stakeholders, allies, and non-allies. These include
industry groups, nonprofits, trade associations, foundations, and activist
organizations, for example, America First Legal Foundation,** USAGM
Watch,** BBG-USAGM Watch,* and Whistleblower Protection Project.*°

CONCLUSION

The USAGM is astory of a lost opportunity both to help restore the world’s con-
fidence in the promise and ideals of America and to set a high mark for journalistic
integrity and unbiased reporting. These two areas have suffered severely under two
decades of USAGM mismanagement and lack of oversight. Finding solutions to
these problems and the restoration of the agency’s networks must be the priorities
of future agency leadership.

To accomplish this, the USAGM must be fully reformed top to bottom with
congressional and White House support. The possibility of consolidating not only
the agency’s subparts, but bringing the entire agency under the supervision of the
NSC, the State Department, or both would dramatically aid that reform.

If the de facto aim of the agency simply remains to compete in foreign markets
using anti-U.S. talking points that parrot America’s adversaries’ propaganda, then
this represents an unacceptable burden to the U.S. taxpayer and a negative return
on investment. In that case, the USAGM should be defunded and disestablished.
If, however, the agency can be reformed to become an effective tool, it would be
one of the greatest tools in America’s arsenal to tell America’s story and promote
freedom and democracy around the world.

AUTHOR’S NOTE: The preparation of this chapter was a collective effort involving many individuals to
whom thanks is owed. These individuals include, but are not limited to, Victoria Coates, Michael Pack, Frank
Wuco, and several brave whistleblowers who prefer not to be named. Their efforts were integral to the chapter
and are greatly appreciated.

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CORPORATION FOR PUBLIC BROADCASTING

Mike Gonzalez

k very Republican President since Richard Nixon has tried to strip the Corpora-
tion for Public Broadcasting (CPB) of taxpayer funding. That is significant not

just because it means that for half acentury, Republican Presidents have failed to

accomplish what they set out to do, but also because Nixon was the first President

in office when National Public Radio (NPR) and the Public Broadcasting Service

(PBS), which the CPB funds, went on air.

In other words, all Republican Presidents have recognized that public funding
of domestic broadcasts is a mistake. As a 35-year-old lawyer in the Nixon White
House, one Antonin Scalia warned that conservatives were being “confronted with
along-range problem of significant social consequences—that is, the development
of a government-funded broadcast system similar to the BBC.”*”

All of which means that the next conservative President must finally get
this done and do it despite opposition from congressional members of his
own party if necessary. To stop public funding is good policy and good politics.
The reason is simple: President Lyndon Johnson may have pledged in 1967
that public broadcasting would become “a vital public resource to enrich our
homes, educate our families and to provide assistance to our classrooms,”**
but public broadcasting immediately became a liberal forum for public affairs
and journalism.

Not only is the federal government trillions of dollars in debt and unable to
afford the more than half a billion dollars squandered on leftist opinion each year,
but the government should not be compelling the conservative half of the country
to pay for the suppression of its own views. As Thomas Jefferson put it, “To compel
aman to furnish contributions of money for the propagations of opinions which

he disbelieves and abhors, is sinful and tyrannical.”*°

A DEMONSTRATED PATTERN OF BIAS
Conservatives will thus reward a President who eliminates this tyrannical sit-
uation. PBS and NPR do not even bother to run programming that would attract
conservatives. As Pew Research demonstrated in 2014, 25 percent of PBS’s audi-
ence is “mostly liberal,” and 35 percent is “consistently liberal.” That is 60 percent
liberal compared to 15 percent conservative (11 percent “mostly conservative” and
4 percent “consistently conservative”).°°
NPR’s audience is even to the Left of that, with 67 percent liberal (41 percent
“consistently liberal” and 26 percent “mostly liberal”), compared with 12 percent
conservative (3 percent and 9 percent “consistently conservative” and “mostly con-
servative,” respectively). That may be an acceptable business model for MSNBC
or CNN, but not for a taxpayer-subsidized broadcaster.

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DEFUNDING THROUGH THE BUDGETARY PROCESS

Cutting off the CPB is logistically easy. The solution lies in the budgetary
process. In 2022, the CPB submitted to the Labor, Health and Human Services,
Education, and Related Agencies Subcommittees of the House and Senate Appro-
priations Committees its budget justification for fiscal year (FY) 2023. In it, the
CPB requested that Congress give it a $565 million advance appropriation—a $40
million increase compared to its FY 2022 funding.*? Unlike most other agencies,
the CPB receives advance appropriations that provide them with funding two years
ahead of time, which insulates the agency from Congress’s power of the purse and
oversight. This special budgetary treatment is unjustified and should be ended.

The 47th President can just tell the Congress—through the budget he proposes
and through personal contact—that he will not sign an appropriations spending bill
that contains a penny for the CPB. The President may have to use the bully pulpit,
as NPRand PBS have teams of lobbyists who have convinced enough Members of
Congress to save their bacon every time their taxpayer subsidies have been at risk
since the Nixon era.

Defunding CPB would by no means cause NPR or PBS—or other public broad-
casters that benefit from CPB funding, including the even-further-to-the Left
Pacifica Radio and American Public Media—to file for bankruptcy. The mem-
bership model that the CPB uses, along with the funding from corporations and
foundations that it also receives, would allow these broadcasters to continue to
thrive. As George Will wrote, “If ‘Sesame Street’ programming were put up for
auction, the danger would be of getting trampled by the stampede of potential
bidders.”** Indeed, “Sesame Street” is on HBO now, which shows its potential as
a money earner.

PUBLIC INTEREST VS. PRIVILEGE

Stripping public funding would, of course, mean that NPR, PBS, Pacifica Radio,
and the other leftist broadcasters would be shorn of the presumption that they act
in the public interest and receive the privileges that often accompany so acting.
They should no longer, for example, be qualified as noncommercial education sta-
tions (NCE stations), which they clearly no longer are. NPR, Pacifica, and the other
radio ventures have zero claim on an educational function (the original purpose
for which they were created by President Johnson), and the percentage of on-air
programming that PBS devotes to educational endeavors such as “Sesame Street”
(programs that are themselves biased to the Left) is small.

Being an NCE comes with benefits. The Federal Communications Commis-
sion, for example, reserves the 20 stations at the lower end of the radio frequency
(between 88 and 108 MHz on the FM band) for NCEs. The FCC says that “only
noncommercial educational radio stations are licensed in the 88-92 MHz ‘reserved’
band,” while both commercial and noncommercial educational stations may

— 247 —

Mandate for Leadership: The Conservative Promise

operate in the “non-reserved” band. This confers advantages, as lower-frequency
stations can be heard farther away and are easier to find as they lie on the left end
of the radio dial (figuratively as well as ideologically).

The FCC also exempts NCE stations from licensing fees. It says that “Noncom-
mercial educational (NCE) FM station licensees and full service NCE television
broadcast station licensees are exempt from paying regulatory fees, provided that
these stations operate solely on an NCE basis.”*®

NPR and PBS stations are in reality no longer noncommercial, as they run ads
in everything but name for their sponsors. They are also noneducational. The next
President should instruct the FCC to exclude the stations affiliated with PBS and
NPR from the NCE denomination and the privileges that come with it.

— 248 —

2025 Presidential Transition Project

ENDNOTES

q
2:

20.

21.
22.
23.

24.

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Ben Weingarten, “Security Failures USG Media Agency Prove Need to Hire Americans First,” Newsweek,
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arch 20, 2023).
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bid.

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bid.
bid.

s/ocb/

omination of

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James Robbins,
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(accessed March 20, 2023).

Agency for Global Media, July 2020, h

f the agency were not an extension o

positions would not be classified in their entirety as Ti
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which they are. See U.S. Agency for G
Federal Register, Vol. 85, No. 115 June

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U.S. Information and Educational Exch

tos://pbbgwatch

US. foreign po

ange Act of 194

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8 (“Smith-Mundt Ac

U.S. Office of Personnel Management, Suitability Agency Executive Programs, Follow Up Review of US.

oads/2020/08/OPM-SuitEA-

licy and national security goals, then its staffing
er 3. and Tier 5 national-security sensitive positions,

13.

”), Public Law 80-402.

Jessica Jerreat, “USAGM CEO Criticized Over Move to
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(accessed March 20, 2023).

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— 249 —

25:

26.

27.

28.
29.

30.

31.

32.
33.

34,
55:

36.

37.

38.

39.

40.

Al.

42.

43.

“Exchange Visito

Mandate for Leadership: The Conservative Promise

Sasha Gong, “VOA Problems: Racism, Xenophobia, Mediocrity, and Nepotism,” BBG-USAGM Watch
25, 2018, archived at https://web.archive.org/web/20220105101300/ht
problems-racism-xenophobia-mediocrity-and-nepotism/ (accessed
a Watch, “Big Mistake in Rewarding Failed
Global Media Managers,” November 11, 2022, https://www.usagmwatch.com/big-mistake-
ed-voice-of-america-voa-and-u-s-Agency-for-globa

U.S. Agency for Global Medi
U.S. Agency for
in-rewarding-fai
arch 20, 2023).
America First Legal Founda
Bennett Citing Nationa
administration-
(accessed March 20, 2023).
U.S. Agency for Global
U.S. Agency for Global

arch 20, 2023).

U.S. Office of Personne
Suitability Program.
bid.

U.S. Agency for Global
U.S. Office of Personne
Suitability Program.
Robbins, “More Rot at America’s Publi
U.S. Department of Jus
an Iranian Intelligence Officer And Me
justice.gov/usao-sdny/pr/manhattan-
(accessed March 20, 2023).

James Robbins, “The Trouble with the
newsweek.com/trouble-open-techno
Susan Crabtree, “Lax Internet Freedon
2020, https://www.realclearpolitics.co

pack_oversight_144043.html (accessed March 20, 2023).

ice, “Manhattan U.S. Attorney A
mbers Of An Iranian Intelligence Ne

edia, Consolidation Report, p. 13.
edia Watch, “Extraordinary Leadership Dysfu
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edia, Consolidation Report, p. 13.
anagement, Follow-Up Review of the U.S. Agency for Global Media

c Diplomacy Mou

us-attorney-anno

Open Technology Fun
ogy-
n Group Balks at New
m/ar

U.S. Department of State, “Visas for

gov/content/travel/en/us-visas/employmen

March 20, 2023).
Authorized posi
visitor, intern, in
scholar, specialist, STEM ini
Visa,” https://travel.s

arch 20, 2023).
ews release, “
Committee, Oc
usagm-personne
U.S. Agency for G
Adequately Vet S
national-securi
U.S. Agency fo
nterference,”

cCaul Dem

oba

aff,” August 8, 2020

Globa

America Firs
Bennet Citing
administration-to-withdraw-nominati
(accessed March 20, 2023).

Legal Foundation, “AFL

ands Answers on USAGM Person
ober 28, 2021, https://foreignaffairs.house.go
-and-management/ (accessed Marc
edia Watch, “USAGM: Past Leaders

ty-procedures-failed-to-adequately-ve
edia, “CEO Pack Launches Investiga
July 30, 2020, https://www.usagm.gov/2020/07/30/ceo-pack-launches-investigation
biden-voa-content-u-s-election-interference/ (accessed

embers of the Foreign

ions for J-1 visas include: au pair, camp counse
ernational visitor, physician

tate.gov/conten

h 20, 2

, https://www.usagmw.
-S

Asks Biden Administra

, professor, research
iatives, summer work travel, teache

aff/ (accessed

arch 20, 2023).
Voice of America

-media-usagm-m

ion, AFL Asks Biden Administration to Withdraw Nominatio
Security and Related Failures,” June 30, 2022,
o-withdraw-nomination-of-amanda-bennett-citing-n

hpiece.”
nnounces Kidnapping Conspiracy Charges Against
work,” July 13, 2021, https://www.
unces-kidnapping-conspiracy-charges-against-iranian

ps://bogwatch.com/bbgwa

, December
ch/voa-

(VOA) Managers

anagers/ (accessed

n of Amanda

https://aflegal.org/afl-asks-biden-
ational-security-and-related-failures/

nction at USAGM Continues,” October 4,

anagement, Follow-Up Review of the U.S. Agency for Global Media

d,” Newsweek, August 9, 2020, https://www.

freedom_agr

und-opinion-1528998 (accessed March 20, 2023).
Pack Oversight,” Real Clear Politics, August 24,
icles/2020/08/24/lax_interne

oup_balks_at_new

Media, Press, and Radio,” h

or, college/university stu

and tra

nel and

023).
gnored

ational Security P

ion Into Pro-Biden VOA Co

arch 22, 2023).
ion to Withdraw Nomination of Aman
ational Security and Related Failures,” June 30, 2022, https://aflegal.org/afl-asks-biden-

on-of-amanda-bennet

— 250 —

tps://travel.state.

t/visas-members-foreign-media-press-radio.html (accessed

dent, government

scholar, secondary school student, short-term
inee. See U.S. Department of State,
/travel/en/us-visas/study/exchange.html (accessed

anagement,” Foreign Affairs
v/press-release/mccaul-demands-answers-on-

rocedures, Failed to

atch.com/usagm-past-agency-leaders-ignored-
arch 20, 2023).

Election
-into-pro-

ntent, U.S.

-citing-national-security-and-related-failures/

AA.
45.
46.

4].

48.

49.

50.

51.
52.

55:

54.

55.

ational Telecom

President Lyndon

munica
Papers, Summary of 197

2025 Presidential Transition Project

U.S. Agency for Global Media Watch, https://www.usag
BBG-USAM Watch, https://bbgwatch.com/bbgwatch/ (accessed March 20, 2023).
Whistleblower Protection Project, “Congress
ismanaged USAGM,” February 9, 2022, https://whipp
investigative-report-revealing-Agencys-chronic-mismanagement/ (accessed March 20, 2023).

ions and Information Administration, “Nixon Administration Public Broadcasting
,” February 23, 1979, https://cu
broadcasting-papers-summary-of-1971/ (accessed
B. Johnson, State of the Un

arch 21, 2023).
ion Address, January 10, 1967, https://www.infoplease.com/

mwatch.com/ (accessed March 20, 2023).

Releases Long-Awaited Investigative Report on Chronically

roj.org/congress-releases-long-awaited-usagm-

rrent.org/1979/02/nixon-administration-public-

primary-sources/government/presidential-speeches/state-union-address-lyndon-b-johnson-january-10-1967

(accessed March 21, 2023).
d Teren
999), p. 390.
Pew Research Center, “Where News Audiences Fit on the Political Spectrum,” October 21, 2014, ht
arization/outlet/pbs/ (accessed March 21, 2023.

Joyce Appleby an
University Press,

journalism.org/in
Ibid.

Corporation for P

Agencies Subcom

eractives/media-po

p. 2, https://www.cpb.org/sites/defaul

(accessed March 21, 2023).
“Public
www.washingtonpost.com/opinion

George F. Will,

Broadcasting’s

46fe-Ne7-al96-albb629f64cb_story.h

Federal Communications Commission,

March 21, 2023).

Federal Communications Commission,
Factsheet No. DA-21-1142, September 10, 2021, p. 2.

ubcon

s/public-broadcastin

o the Labor,
Appropriations C

/files/appropriat

mmortality Defie

ce Ball, eds., Jefferson: Political Writings (Cambridge and New York: Cambridge

p://www.

blic Broadcasting, Corporation for Public Broadcasting Appropriation Request and
Justification FY 2023/FY 2025, Submitted
mittee of the House
Education and Related Agencies S

Health and Human Services, Education and Related
ommittee and the Labor, Health and Human Services,

mittee of the Senate Appropriations Committee, March 28, 2022,

ion/FY-2023-2025-CPB-Budget-Justification.pdf

s Reason,” The Washington Post, June 2, 2017, https://

“FM Radio,” http

“Regulatory Fee

— 251

gs-immortality-defies-reason/2017/06/02/f5de02be-

ml?utm_term=.8df3a0lf6ca6 (accessed March 21, 2023).

s://www.fcc.gov/general/fm-radio (accessed

Exemptions for FY 2021,” FCC Regulatory Fees

AGENCY FOR
INTERNATIONAL
DEVELOPMENT

Max Primorac

MISSION

The U.S. Agency for International Development leads the U.S. government’s
international development and disaster assistance programs. USAID helps com-
munities to lead their own development journeys by reducing the impact of conflict;
preventing hunger and the spread of pandemic disease; and counteracting the driv-
ers of violence, instability, transnational crime, and other threats. In alignment
with U.S. national security interests, the agency promotes American prosperity
through initiatives that expand markets for U.S. exports; encourage innovation;
create a level playing field for U.S. businesses; and support more stable, resilient,
and democratic societies that are less likely to act against American interests and
more likely to respect family, life, and religious liberty.

OVERVIEW

USAID was established during the presidency of John F. Kennedy pursuant
to the Foreign Assistance Act of 1961’ to promote the foreign policy, security, and
national interests of the United States. At the height of the Cold War with the
Soviet Union, it sought to halt the spread of Communism by assisting peoples in the
developing world in their efforts to advance economically, socially, and politically.
The agency helped to transition Central and Eastern Europe from socialism to
free market-based democracies. Today, USAID leads the U.S. government’s global
development and humanitarian disaster assistance responses.

Over the years, USAID expanded the number of countries assisted, the scope
and size of its activities, and especially its budget. The Trump Administration faced

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Mandate for Leadership: The Conservative Promise

an institution marred by bureaucratic inertia: programmatic incoherence; waste-
ful spending; and dependence on huge awards to a self-serving and politicized aid

industrial complex of United Nations agencies, international nongovernmental

organizations (NGOs), and for-profit contractors. Once started, programs continue

almost indefinitely—in many countries, for decades. USAID’s multibillion-dollar

humanitarian programs that were once 80 percent in response to natural disasters

are now 80 percent in response to violent, man-made crises and have become a

permanent and immiserating feature of the global landscape.

Under the Trump Administration, USAID focused on ending the need for for-
eign aid by placing countries onto a Journey to Self-Reliance.” The Administration
restructured the agency to reflect this strategic approach to development, stream-
lined procurement procedures to diversify its partner base, increased awards to
cost-effective local Gncluding faith-based) organizations, and improved inter-
nal governance. It instituted pro-life and family-friendly policies. It promoted
international religious freedom as a pillar of the agency’s work and built up an
unprecedented genocide-response infrastructure.

The Biden Administration has deformed the agency by treating it as a global
platform to pursue overseas a divisive political and cultural agenda that promotes
abortion, climate extremism, gender radicalism, and interventions against perceived
systemic racism. It has dispensed with decades of bipartisan consensus on foreign
aid and pursued policies that contravene basic American values and have antago-
nized our partners in Asia, Africa, and Latin America. It has decoupled USS. assistance
from free-market reforms that are the keystone of economic and political stability
and has teamed with global institutions to impose central planning diktats on an
unprecedented scale. Wasteful budget increases requested by the Administration
and appropriated by Congress have outstripped USAID’s capacity to spend funds
responsibly, and U.S. foreign aid has been transformed into a massive and open-
ended global entitlement program captured by—and enriching—the progressive Left.

The next conservative Administration should scale back USAID’s global foot-
print by, at aminimum, returning to the agency’s 2019 pre-COVID-19 pandemic
budget level. It should deradicalize USAID’s programs and structures and build
on the conservative reforms instituted by the Trump Administration. This will
require working closely with the U.S. Congress to make deep cuts in the interna-
tional affairs “150 Account” while granting USAID greater flexibility in spending
its appropriated funds to achieve better developmental outcomes.

KEY ISSUES

Aligning U.S. Foreign Aid to U.S. Foreign Policy. U.S. foreign aid is too often
disconnected from the strategy and practice of U.S. foreign policy. Its coordination
is made difficult as the aid budget is divided among approximately 20 offices, agen-
cies, and departments that provide some form of foreign assistance.

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2025 Presidential Transition Project

The USAID Administrator should be authorized to take on the additional role
of Director of Foreign Assistance (DFA) with the rank of Deputy Secretary at the
Department of State in charge of all U.S. foreign assistance. The DFA role would
empower this person to align and coordinate the countless foreign assistance
programs across the U.S. government and carry out the agenda of the next con-
servative President more effectively. A version of this role existed during the last
two years of the George W. Bush Administration, but the Obama Administration
eliminated it in 2009.

Countering China’s Development Challenge. Through its trillion-dollar
Belt and Road Initiative (BRI), the Peoples Republic of China (PRC) has directed
billions of dollars in loans and investments to advance its geostrategic objective
of displacing the United States as the premier global power. The PRC leverages
its transactions—termed “debt traps” by many critics—to strengthen its global
influence, extract natural resources, isolate Taiwan, win political support at
international fora, and access ports and bases for its military. In Latin America,
25 of 29 countries participate in the BRI, and the PRC ranks as the region’s largest
trading partner. Since 2005, Chinese state-owned banks have issued $138 billion
in loans to Latin American countries, and other Chinese entities have invested
an additional $140 billion. In Africa, China has issued $160 billion in loans and
dominates the continent’s rare earth mining sector, which is critical to global
energy development.

The World Bank estimates that 60 percent of all BRI loans are in financial
distress, leading many countries to seek emergency financial help from Western
donors. Chinese-funded projects are known for employing substandard labor and
environmental practices, fueling corruption, promoting wasteful financial deci-
sions by governments, advancing China’s geostrategic interests, and creating an
unequal trade relationship in which China secures raw materials from developing
countries and sells those countries manufacturing products. For example, Brazil,
a world leader in shoe production, saw its industry collapse under a flood of cheap
Chinese imports. China’s mercantilist penetration of the developing world and
the negative consequences for developing countries’ healthy economic growth
have undercut U.S. strategic relationships in those countries and wasted billions
in US. foreign aid.

During the Trump Administration, USAID:

e Inaugurated a robust counter-China response called Clear Choice?®
that contrasted America’s development approach based on liberty,
sovereignty, and free markets with China’s mercantilist authoritarianism
that pursued predatory financing schemes and economic and political
subordination to Beijing.

— 255 —

Mandate for Leadership: The Conservative Promise

e Launched its first Digital Strategy* to promote safe 5G access in emerging
markets and combat Beijing’s efforts to equip regimes with tools to
stifle democracy.

e Struck bilateral development relationships with Japan, Israel, Kuwait, Qatar,
the United Arab Emirates, and Taiwan to support projects in sub-Saharan
Africa, Asia, Latin America, and the Middle East.

e Established an office in Greenland to help counter China’s claims of being “a
near Arctic state” and reoriented its programming across Asia—including
establishing a USAID Mission to Central Asia—in line with America’s Indo-
Pacific strategy.®

e Joined with the U.S. Department of Homeland Security and National
Oceanic and Atmospheric Administration to help coastal countries
detect and halt illegal, unreported, and unregulated fishing and confront
criminal activities practiced by state-run Chinese fishing fleets that violate
international norms, ravage fishing industries in developing countries,
worsen food insecurity, rob vulnerable communities of their livelihoods,
and deplete maritime resources.

USAID built an organizational infrastructure to carry out its multiple lines of
counter-China operations. An agencywide Clear Choice Executive Council and
USAID-U.S. International Development Finance Corporation Working Group
reviewed all proposed assistance programs and proposals through a counter-China
lens. A senior executive-level Clear Choice Coordinator, reporting to the Adminis-
trator, advised the agency’s leadership on initiatives to counter China, supported
by a fully dedicated six-person Secretariat.

The Biden Administration discontinued these programs and allowed USAID's
counter-China architecture to waste away, subordinating our national security
interests to progressive climate politics in which Communist China is viewed as
a global partner.

The next conservative Administration should restore and build on the Trump
Administration’s counter-China infrastructure at USAID, end the climate policy
fanaticism that advantages Beijing, and assess bilateral aid through the lens of
U.S. national security interests, rewarding those countries that resist China’s
debt diplomacy. It should finance programs designed to counter specific Chinese
efforts in strategically important countries and eliminate funding to any partner
that engages with Chinese entities directly or indirectly. USAID’s Bangkok-based
Regional Development Mission for Asia should focus its strategic attention on
supporting cross-border initiatives designed to counter Chinese influence.

— 256 —

2025 Presidential Transition Project

Climate Change. Upon taking office, President Biden issued executive orders
to “put the climate crisis at the center of U.S. foreign policy and national security”
and mitigate “the devastating inequalities that intersect with gender, race, ethnic-
ity, and economic security.”° USAID subsequently declared itself “a climate agency”
and redirected its private-sector engagement strategy—teaming with America’s
corporate sector to wean countries off foreign aid through private investment and
trade—to support the Administration’s global policy to “transition from fossil fuels
to renewable energy.”

The Administration has incorporated its radical climate policy into every
USAID initiative. It has joined or funded international partnerships dedicated to
advancing the aims of the Paris Climate Agreement and has supported the idea of
giving trillions of dollars more in aid transfers for “climate reparations.”

The Biden Administration’s extreme climate policies have worsened global
food insecurity and hunger. Its anti-fossil fuel agenda has led to a sharp spike in
global energy prices. Inflation has hit the poor the hardest as they expend a higher
proportion of income on food purchases. Farmers in poor countries can no longer
afford to buy expensive natural gas—based fertilizers that are key to achieving high
yields of food production. Under advice from climate radicals, the government of
Sri Lanka even banned chemical fertilizers entirely without having any replace-
ments in place. The result has been hunger and violent political instability.

The aid industry claims that climate change causes poverty, which is false.
Enduring conflict, government corruption, and bad economic policies are the
main drivers of global poverty. USAID’s response to man-made food insecurity
is to provide more billions of dollars in aid—a recipe that will keep scores of poor
countries underdeveloped and dependent on foreign aid for years to come.

The impact on Africa is especially acute. South Africa, for example, relies on
coal-powered plants to generate 80 percent of its power needs. It would need $26
billion in foreign aid to make the full transition away from coal. Multiplying this
amount by dozens of other countries on the continent, the financial resources
needed to transition away from fossil fuels are unachievable. In Latin America,
countries that are global leaders in oil and gas production have sharply curtailed
their energy production in line with climate activists, upending the hemisphere’s
major source of export revenues and condemning it to years of economic and polit-
ical instability.

USAID should cease its war on fossil fuels in the developing world and support
the responsible management of oil and gas reserves as the quickest way to end
wrenching poverty and the need for open-ended foreign aid. The next conservative
Administration should rescind all climate policies from its foreign aid programs
(specifically USAID’s Climate Strategy 2022-2030"); shut down the agency’s offices,
programs, and directives designed to advance the Paris Climate Agreement; and
narrowly limit funding to traditional climate mitigation efforts. USAID resources

— 257 —

Mandate for Leadership: The Conservative Promise

are best deployed to strengthen the resilience of countries that are most vulner-
able to climatic shifts. The agency should cease collaborating with and funding
progressive foundations, corporations, international institutions, and NGOs that
advocate on behalf of climate fanaticism.

Diversity, Equity, and Inclusion Agenda. USAID installed advisers on
Diversity, Equity, and Inclusion (DEI) committees “in all its Bureaus, Offices, and
[overseas] Missions” and created “an agency-wide dashboard and DEI scorecard
for all bureaus, offices, and missions” to track staff compliance with the Adminis-
tration’s DEI directives. A Chief DEI Officer oversees this DEI infrastructure and
sits in the Administrator’s office. DEI directives are now part of all agency policies
and are incorporated as standard clauses in all contract and grant awards. Those
seeking to do business with the agency must “describe the approaches they will
use to diversify their partner base.”* USAID often ties DEI to “gender and climate
equity,” corrupting every aspect of the agency’s overseas work.

The upshot has been to racialize the agency and create a hostile work environ-
ment for anyone who disagrees with the Biden Administration’s identity politics.
This pursuit of ideological purity threatens merit-based professional advancement
for staff who do not overtly conform, hyperpoliticizes what should be a nonpartisan
federal workplace environment, creates an institutionalized cadre of progressive
political commissars, corrupts the award process, and discourages potential con-
tractors and grantees that disagree with this radical agenda from applying for
USAID funding.

The next conservative Administration should dismantle USAID’s DEI apparatus
by eliminating the Chief Diversity Officer position along with the DEI advisers and
committees; cancel the DEI scorecard and dashboard; remove DEI requirements
from contract and grant tenders and awards; issue a directive to cease promotion
of the DEI agenda, including the bullying LGBTQ+ agenda; and provide staff a
confidential medium through which to adjudicate cases of political retaliation
that agency or implementing staff suffered during the Biden Administration. It
should eliminate funding for partners that promote discriminatory DEI practices
and consider debarment in egregious cases.

As federal departments and agencies cannot play partisan politics, staff—irre-
spective of hiring mechanism—as well as implementers and grantees that engage
in ideological agitation on behalf of the DEI agenda should be dismissed, and enti-
ties should be debarred. The next conservative Administration should return the
authority over all civil rights issues at USAID to the agency’s Office of Civil Rights,
which is the appropriate locus for ensuring that all Americans have guaranteed
equality of career opportunity at USAID.

Refocusing Gender Equality on Women, Children, and Families. Instead
of protecting women’s and children’s unalienable human rights and propelling
their ability to thrive in society, past Democrat Administrations have nearly erased

— 258 —

2025 Presidential Transition Project

what females are and what femininity is through “gender” policies and practices.
For instance, these Administrations have diluted USAID’s focus on assisting vul-
nerable women, children, and families around the globe by adding protections for
and ideological advocacy on behalf of progressive special-interest groups. USAID
now aggressively promotes abortion on demand under the guise of “sexual and

29 66

reproductive health and reproductive rights,” “gender equality,” and “women’s
empowerment” and advocates for those who claim minority status or vulnerability.

Families are the basic unit of and foundation for a thriving society. Without
women, there are no children, and society cannot continue. As evidenced by the
confirmation testimony of now-Associate Justice Ketanji Brown Jackson, the
progressive Left has so misused and altered the definition of what a “woman” is
that one of our U.S. Supreme Court Justices was unable to delineate clearly the
fundamental biological and sexual traits that define the group of which she is a
part. USAID cannot advocate for and protect women when they have been erased
globally along with the values and traditional structures that have supported them.

The next conservative Administration should rename the USAID Office of
Gender Equality and Women’s Empowerment (GEWE) as the USAID Office of
Women, Children, and Families; refocus and realign resources that currently
support programs in GEWE to the Office of Women, Children, and Families; redes-
ignate the Senior Gender Coordinator as an unapologetically pro-life politically
appointed Senior Coordinator of the Office of Women, Children, and Families; and
eliminate the “more than 180 gender advisors and points of contact...embedded in
Missions and Operating Units throughout the Agency.”®

In addition, the next conservative Administration should rescind President
Biden’s 2022 Gender Policy and refocus it on Women, Children, and Families
and revise the agency’s regulation on “Integrating Gender Equality and Female
Empowerment in USAID’s Program Cycle.”"° It should remove all references, exam-
ples, definitions, photos, and language on USAID websites, in agency publications
and policies, and in all agency contracts and grants that include the following

29 66 29 66 29 66

terms: “gender,” “gender equality,” “gender equity,” “gender diverse individu-

29 66

als,” “gender aware,” “gender sensitive,” etc. It should also remove references to

29 66.

“abortion,” “reproductive health,” and “sexual and reproductive rights” and con-
troversial sexual education materials.
In the past, the word “gender” was a polite alternative to the word “sex” or term
“biological sex.” The Left has commandeered the term “gender,” which used to
mean either “male” or “female,” to include a spectrum of others who are seeking to
alter biological and societal sexual norms. The promotion of gender radicalism is
anathema to the traditional norms of many societies where USAID works, causes
resentment by tying lifesaving assistance to rejecting the aid recipient’s own firmly
held fundamental values regarding sexuality, and produces unnecessary conster-

nation and confusion among and even outright bias against men.

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The next Administration should ensure that USAID’s goal in service of its
mission is to help protect and propel all members of society—women, children,
and men—from conception to natural death. To do so, USAID’s Office of Women,
Children, and Families should strive to ensure that communities have their basic
human needs, without which they will be unable to thrive, met first and foremost.
Basic human needs include equal and safe access to potable water, sanitation, food,
education, health care, houses of worship, justice, pregnancy and family resource
centers, working capital, electricity, technology, and business opportunities. The
Office of Women, Children, and Families should implement the Geneva Consen-
sus Declaration on Women’s Health and Protection of the Family and prioritize
partnerships with local organizations, including faith-based organizations (FBOs).

Protecting Life in Foreign Assistance. Protecting life should be among the
core objectives of United States foreign assistance. Shortly after taking office, how-
ever, President Biden issued a memorandum that reversed a myriad of pro-life
policies and revoked the Protecting Life in Global Health Assistance (PLGHA)
policy, widely known as the Mexico City Policy. Biden also restored funding to
the United Nations Population Fund (UNFPA), which supports and implements
China’s coercive abortion and sterilization regimen.

PLGHA requires foreign NGOs, as a condition of receiving assistance, to agree
not to perform or actively promote abortions as a method of family planning in
foreign countries. Previous pro-life Presidents beginning with Ronald Reagan
applied these conditions to family planning assistance, but President Trump for
the first time expanded the Mexico City Policy to protect “global health assistance
furnished by all departments or agencies” (estimated to be $8.8 billion annually).

The Biden Administration restored abortion subsidies to pro-abortion NGOs
including Planned Parenthood International and MSI Reproductive Choices. In
reversing PLGHA, Biden declared a radical assault on the policy of protecting life,
choosing instead to promote abortion on demand around the world under the
guise of “sexual and reproductive health and rights.” USAID’s priority of funding
the global abortion industry negates programs that promote life, women’s health,
and the family.

Even under PLGHA, several loopholes allowed support for the global abortion
industry to continue. International NGOs that perform and promote abortions
overseas like Population Services International, Pathfinder, PATH, the Population
Council, EngenderHealth, and WomanCare Global International continued to
receive funding from USAID under PLGHA and now, under Biden, receive tens
of millions more in U.S. taxpayer dollars in foreign assistance annually without
any oversight. When the United Nations Secretariat promoted abortion and abor-
tion-inducing drugs under the umbrella of “sexual and reproductive health” as
an element of its COVID-19 Global Humanitarian Response Plan in May 2020,
the exemptions in PLGHA for humanitarian aid and multilateral organizations

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illuminated another loophole in the policy’s effectiveness in safeguarding U.S. tax-
payer dollars from being used to promote abortion.

Pro-abortion groups also have received funds under other categories of foreign
aid that fall outside the scope of global health assistance, including women-related
and economic assistance programs. Members of Congress have advocated closing
these loopholes by extending PLGHA to all foreign assistance through the Protect-
ing Life in Foreign Assistance Act, sponsored by Senator Mike Lee (R-UT) and
Representative Virginia Foxx (R-NC)." Current law in the Foreign Assistance Act
gives the President broad authority to set “such terms and conditions as he may
determine” on foreign assistance, which legally empowers the next conservative
President to expand this pro-life policy.

To stop U.S. foreign aid from supporting the global abortion industry, the next
conservative Administration should issue an executive order that, at a minimum,
reinstates PLGHA and summarily blocks funding to UNFPA but also closes loop-
holes by applying the policy to all foreign assistance, including humanitarian aid,
and improving its enforcement. The executive order to reinstate PLGHA should
be drafted broadly to apply to all foreign assistance. It should simultaneously
rescind President Biden’s memorandum entitled “Protecting Women’s Health at
Home and Abroad,” issued on January 28, 2021.” The new pro-life executive order
should apply to foreign NGOs, including subgrantees and subcontractors, and
remove exemptions for U.S.-based NGOs, public international organizations, and
bilateral government-to-government agreements. All entities funded by USAID,
both directly and indirectly, should report their compliance with the PLGHA, and
USAID should institute penalties, including debarment from future federal funding,
for violations of it. The new executive order also should instruct the Administrator
of USAID to publish reports on implementation of the PLGHA by both prime and
sub-prime recipients.

In addition, the Helms Amendment should continue to be applied, as it has been
by both Republican and Democratic Administrations for more than 50 years, as a
complete ban on the use of taxpayer dollars to pay for abortions abroad.

International Religious Freedom. Conservatives believe international
religious freedom is central to USAID’s development efforts. President Trump’s
Executive Order 13926 on “Advancing International Religious Freedom”
instructed the Secretary of State, in consultation with the USAID Administrator,
to budget at least $50 million a year for programs that advance international reli-
gious freedom and “ensure that faith-based and religious entities, including eligible
entities in foreign countries, are not discriminated against on the basis of religious
identity or religious belief when competing for Federal funding.”

Under the Trump Administration, the agency set up a senior-level Chief Adviser
for International Religious Freedom who reported directly to the Administra-
tor with the task of coordinating a “whole-of-USAID” approach to achieving this

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priority. It created a robust genocide-response capability. USAID affirmed the
agency’s partnerships with faith-based organizations through its rule on “Partic-
ipation by Religious Organizations in USAID Programs;”“ “Partnership Guidance
and Answers to Frequently Asked Questions (FAQs) for Faith Based Organizations;”
and “Legal Guidance and Answers to FAQs for USAID Staff.”

Today, USAID officials and their progressive partners have resisted efforts to
promote religious freedom, especially as it relates to abortion and gender ideology,
which are anathema to the traditional societies where USAID funds programs (in
addition to many U.S. taxpayers). U.S. Secretary of State Antony Blinken repudiated
his predecessor’s focus on religious freedom.

The next conservative Administration must champion the core American value
of religious freedom, which correlates significantly with poverty reduction, eco-
nomic growth, and peace. It should train all USAID staff on the connection between
religious freedom and development; integrate it into all of the agency’s programs,
including the five-year Country Development and Coordination Strategies due
for updates in 2025; strengthen the missions’ relationships with local faith-based
leaders; and build on local programs that are serving the poor. Congress should
appropriate funding to USAID specifically to support persecuted religious minori-
ties in line with Executive Order 13926.

Streamlining Procurement and Localizing the Partner Base. USAID is a
grantmaking and contracting agency that disburses billions of dollars of federal
funding in developing countries through implementing partners, such as U.N. agen-
cies, international NGOs, for-profit companies, and local nongovernmental entities.
Inrare instances, such as in Jordan and Ukraine, the agency provides direct budget
support to finance the operations of host-country governments. USAID far more
often counts on expensive and ineffective large contracts and grants to carry out
its programs. It justifies these practices based on speed and a lower administrative
burden on its institutional capacity.

Partnering and procurement reform was a pillar of the Trump Administration’s
effort to secure better development results, cut costs, and advance the Journey to
Self-Reliance strategy of exiting countries from aid. In December 2018, USAID
launched its first Acquisition and Assistance Strategy to streamline procurement
processes; introduce innovation into its programming; and diversify its partner
base away from large, expensive, and partisan implementers. The strategy counted
on local NGOs, including faith-based entities already on the ground, to provide
the agency with less costly and more effective alternatives to the aid giants. The
strategy also prioritized global partnerships with the private sector—corporations,
investors, diasporas, and private philanthropies—the source of real capital invest-
ment, innovation, and efficiencies that can maximize the impact of taxpayer dollars.
Under the Biden Administration, despite rhetoric to the contrary, the aid industrial
complex has recaptured the agency and stifled further reforms.

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The next conservative Administration should immediately implement language
on key policy topics as standard provisions in all grants, cooperative agreements,
and contracts. These provisions should include language on implementing the
Policy on Protecting Life in Foreign Assistance, imposing conditions on funding
to multilateral organizations, and increasing accountability and transparency.

To ensure that USAID exercises its existing authorities to streamline procure-
ment processes, the next conservative Administration should name a political
appointee as the agency’s Senior Procurement Executive and Director of the agen-
cy’s Office of Assistance and Acquisitions (OAA) in the Bureau of Management (M).
The head of M/OAA is one of the most important positions at USAID, as the office is
ground zero for controlling the disbursement of U.S. foreign aid. The White House
should empower the Administrator and his or her designees to make determina-
tions concerning the scale and scope of awards and increase the transparency and
accountability of subawards, which can escape public scrutiny and promote pro-
gressive policies during conservative Administrations. USAID should use existing
authority to use program funds to expand its roster of contracting and agreement
officers to accelerate the delivery of funds for disaster responses to a more diverse
collection of implementers.

Accomplishing the next conservative Administration’s policy goals at USAID
will require that political appointees have knowledge of, responsibility for, and
visibility into the design and awarding of grants, contracts, and cooperative
agreements. The Administration should restore the Senior Official Accountabil-
ity Review (SOAR) or create a similar process to ensure that proposed programs
above a certain dollar threshold in Total Estimated Cost/Total Estimated Amount
receive a close review by policymakers in each bureau and office and, for large
awards, in the agency’s front office.

“Localization” is a buzzword within the aid community but correctly assumes
that more funding through local organizations produces better aid outcomes. Shift-
ing from giant U.S.-based implementers has proved difficult to achieve, however,
given intense internal bureaucratic resistance; opposition from the aid industrial
complex; and foot-dragging from progressives, who view local NGOs—especially
faith-based NGOs prominent in Africa and Latin America—as obstacles to promot-
ing abortion, gender radicalism, climate extremism, and other woke ideas.

The President’s Emergency Plan for AIDS Relief (PEPFAR) has shown that
localization at scale is possible within a short time span. Over the four years of the
Trump Administration, the multibillion-dollar program increased the amount
of funding disbursed to local entities from about 25 percent to nearly 70 percent
with positive overall results. This model should be replicated across all of USAID.

In addition, the next conservative Administration should expand use of the New
Partnership Initiative (NPI) to every bureau and office; reset the requirements for
USAID’s overseas missions to craft and execute NPI action plans; and assign each

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Mandate for Leadership: The Conservative Promise

mission a minimum percentage of its portfolio that must go to new, underutilized,
and local partners. Crucial to the strategy will be increasing the use of open com-
petition that lowers barriers to entry and fixed-amount awards that carry less of
a compliance burden along with eliminating cost-plus reimbursement contracts

that favor large companies. Before advancing a new program, the agency should

be required to assess existing local activities to avoid undercutting or duplicating
them. At every opportunity, USAID should build on existing local initiatives.

Global Health. The United States is the world’s largest funder of global health
initiatives. For more than 60 years, the American people have offered health assis-
tance to the world and saved millions of lives. The USAID Bureau for Global Health
(GH), the second largest within USAID, oversees a multibillion-dollar operation
to support maternal and child health; voluntary family planning; PEPFAR and
the President’s Malaria Initiative (PMI) (both started under President George W.
Bush); and other initiatives against other infectious and neglected tropical diseases.
Effective use of funds is essential to maximize care for the world’s neediest people.

Countries with strong health institutions and sound public health practices
responded quickly to and recovered more rapidly from the COVID-19 pandemic.
This demonstrates the importance of “localization,” by which USAID helps gov-
ernments and the private sector in developing countries to strengthen their
own ability to address needed training, services, accountability, and organiza-
tional capacity.

Unfortunately, many USAID -funded global health activities remain rooted in
patterns that began decades ago and measure improvements in terms of inputs—
money spent—instead of outcomes achieved. From the 1950s to 1970s, the major
recognized threats to human health were infectious diseases such as polio and
smallpox, and USAID funded programs “in” a country, not “with” a country. Mater-
nal and child health, food, water, and sanitation programs were often intermittent.
USAID consistently financed population control, contraception, and abortion as
essential to “development.” Most programs focused on one disease or condition
but had little integration with other global health activities. Chronic diseases
were ignored.

Consequently, the next conservative Administration should focus on updating
the Global Health Bureau’s portfolio, emphasizing a comprehensive approach to
supporting women, children, and families; building host-country institutional
capacity; increasing awards to local and faith-based partners (expanding what
occurred during the Trump Administration with the NPI); and improving USAID’s
ability to coordinate with local partners.

Updating Funding Priorities. The Bureau should identify and eliminate out-
dated and ineffective concepts and focus on funding innovation. A rigorous review
is necessary to ensure that current programs and funding streams avoid wasting
taxpayer dollars and prioritize what is needed now and what works.

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Focusing on Holistic Health Care and Support for Women, Children, and
Families. The continued high rate of maternal and infant mortality is a persistent
global tragedy. Contrary to current publicity, this problem is not solved by abortion.
Families genuinely cherish children. The next leadership at USAID must focus
attention on women and children’s health (including unborn children) as well
as health risks across life spans, including childhood infections, cervical cancer,
adolescent risks, and family stability, by utilizing a coordinated approach. The
Bureau should implement a “Request for Application for Resilient Families” that
harvests collaborative funds from siloed programs and makes individuals and the
family, not diseases or conditions, the true focus of intervention.

Increasing USAID Collaboration with Faith-Based Organizations. F BOs
historically have been much more successful in outreach to remote and vulnerable
populations, based on trust built through decades of service. The value of collab-
orating with FBOs was demonstrated in the October 2020 Evidence Summit on
Religious Engagement. In sub-Saharan Africa, FBOs often provide more than 80
percent of health care, especially to the extremely poor. In contrast, the Global
Health Bureau historically has provided 85 percent of its funding to large U.S. NGOs
with significant overhead costs, as a result of which only 20 percent-30 percent of
funding reaches people in need.

Leveraging the Strength and Experience of Presidential Initiatives. Mil-
lions of people are alive today because of the American people’s investment in
PEPFAR and PMI. The training, laboratory, clinical intervention, health educa-
tion, data collection, and organizational platforms of these programs became the
bedrock for responding to the COVID pandemic. It is time for these programs to
become part of an integrated, strong, and sustainable network of health care and
public health in developing countries. A smooth transition to national ownership
and funding, however, will require better coordination of USAID’s own stovepiped
programs with PEPFAR and PMI.

Strengthening the Collection and Use of Data. Good decisions are based on
accurate data. For decades, global health programs have relied mostly on statis-
tical modeling (rather than actual data) or survey data (the weakest type of data).
Poor data quality undermines both the evaluation and improvement of desired
outcomes achieved by our global health programs. The Trump Administration
implemented critical updates of PEPFAR’s systems for the collection and reporting
of data to increase transparency and hold funded partners and overseas missions
accountable. The next conservative Administration should apply these reforms
to all of USAID’s global health programs.

Strengthening Private-Sector Engagement. The Bureau’s Center for Inno-
vation and Impact (CII) should be empowered to expand networks of private
and faith-based health organizations that can develop projects using develop-
ment-impact bonds, capital funds, and innovative technologies, including with the

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Mandate for Leadership: The Conservative Promise

Millennium Challenge Corporation and the new U.S. International Development
Finance Corporation. More flexible and agile CII funding will spur innovation
within the Bureau and help to enhance countries’ self-reliance in the provision
of health care.

Improving Bureau Hiring, Staffing, and Recruitment Practices. The
Global Health Bureau should address its own management challenges by modifying
the high ratio of contractors to direct hires, holding career leadership accountable
for effective management, and building more flexibility in emergency responses.
Bureau personnel suffer from “mission drift,” burnout, and a lack of vision. New
directives, social agendas, and extra layers of review have obscured core activities
and caused talent to leave the agency. Conservative leadership must return the
focus to development and improved workforce morale and focus on global out-
comes and the efficient use of taxpayer dollars.

Holding the U.N., the World Health Organization (WHO), and Other Mul-
tilateral Organizations Accountable. Leadership should designate a political
appointee to help coordinate cross-agency efforts to hold the U.S. government’s
multilateral partners (U.N. and WHO agencies and other international organiza-
tions) to a higher level of financial and programmatic accountability, including
assurances that language promoting abortion will be removed from U.N. docu-
ments, policy statements, and technical literature. The United States must have
more prominent representation in international technical committees and regu-
lation-setting organizations to ensure the proper execution of American resources,
the preservation of our values, the protection of innovation, and the vitality of our
biomedical sector.

Global Humanitarian Assistance. The U.S. government is the world’s largest
humanitarian actor, annually disbursing billions of dollars in lifesaving assistance—
food, water, shelter, emergency health care, and related protection support—to
tens of millions of vulnerable people. Funded by the U.S. Congress through the
International Disaster Assistance (IDA) account, USAID pays for nearly half of the
budget of the Nobel Prize-winning U.N. World Food Programme (WFP) as well
as dozens of simultaneous operations that range from responses to hurricanes in
Central America to tackling outbreaks of Ebola in Central Africa and caring for
millions of people displaced by ongoing conflicts.

USAID’s emergency responses once were focused primarily on natural cata-
clysms such as hurricanes, floods, and earthquakes. Today, the agency spends more
than 80 percent of its humanitarian budget on chronic man-made crises. Most of
these “emergency responses” began years ago and absorb billions of dollars annu-
ally with no end in sight. Every year sees financial demands grow in response to
new conflicts, most recently Ukraine. The budget of the Bureau for Humanitarian
Assistance (BHA) has doubled compared to just a few years ago, and BHA can no
longer manage its funds responsibly. A politically powerful foreign aid industry that

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benefits financially from extending and expanding these large-scale programs for
years, even decades, ensures little scrutiny of these ever-increasing appropriations.

The massive growth in “emergency” aid distorts humanitarian responses, wors-
ens corruption in the countries we support, and exacerbates the misery of those
we intend to help. The permanence of this assistance, particularly in countries
where we have little to no in-country presence and must rely on U.N. agencies to
self-monitor, has morphed into a co-governance scheme in which the U.S. govern-
ment effectively finances the social services obligations of corrupt regimes that
threaten the United States. These governments can then redirect scarce budget
resources away from costly health and education toward financing their wars, sup-
porting terrorism, repressing their citizens, and enriching themselves. Examples
of this abuse are spread throughout the world.

e Over the past decade, the U.S. government has expended $14 billion in aid to
Syria where the bloody regime of Bashar al-Assad—a close ally of Iran and
Russia—skims nearly half of foreign aid through inflated official exchange
rates, the diversion of food baskets to its military units, and procurement
arrangements with compromised local contractors.

e Yemen, once the breadbasket of the Arabian Peninsula, is now dependent
on billions of dollars of aid as formerly productive Yemeni farmers cannot
compete against “free food” while irrigation systems remain in disrepair,
leaving the country to suffer from water shortages during long summer
droughts and flooding during its rainy season. Iran-backed Houthi rebels
divert substantial amounts of aid to support their war efforts.

e InAfghanistan, the aid infrastructure built over 20 years of American
military presence that three Presidents wanted to end collapsed with the
failure of U.S.-trained Afghan forces to repel the Taliban’s 2021 advances.
Yet the country has received nearly $1 billion more in U.S. humanitarian aid
since the Taliban’s takeover and absent a U.S. embassy to ensure that it is not
diverted to the Taliban and other terrorist groups.

e In Burma, U.S. aid finances all of the food and medical care for hundreds of
thousands of persecuted Rohingya that the military regime forces to live in
open-air concentration camps.

e Innorthern Iraq, hundreds of thousands of Yazidis—targeted for genocidal
extermination by ISIS—remain in miserable camps unable to return home
because of the Iraqi government’s refusal to clear out Iran-backed militias
occupying their homeland.

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In effect, humanitarian aid is sustaining war economies, creating financial
incentives for warring parties to continue fighting, discouraging governments
from reforming, and propping up malign regimes.

Nefarious actors reap billions of dollars in profits from diversions of our human-
itarian assistance, but so do international organizations. The WFP charges 36
percent in overhead while Oxfam International’s overhead has reached 70 percent
in Yemen, reflecting the high costs of foreign staff, security, and logistics. With pow-
erful lobbies in Washington, D.C., and in leadership positions throughout USAID
and the Department of State, the aid industry adroitly exploits Congress’s dispo-
sition to increase funding year on year to assist those in dire need but provides no
evidence to justify the mounting budget requests.

In 2020, USAID’s leadership fused formerly bifurcated food and nonfood
emergency relief operations into a single Bureau for Humanitarian Assistance
to improve the management of the agency’s largest portfolio, but this reform was
not sufficient to address the problem. The next Administration should resize and
repurpose USAID’s humanitarian aid portfolio to restore its original purpose of
providing emergency short-term relief, prepare vulnerable communities for tran-
sition, and do no harm in the following ways:

e Work with Congress to make deep cuts in the IDA budget by ending
programs that do more harm than good in places controlled by malign
actors, such as in Yemen, Syria, and Afghanistan, where our aid is consumed
by fraud, diversion, and partner overhead costs.

e Require USAID and the State Department to devise country-based exit
strategies that term-limit the duration of humanitarian responses and
transition funding from emergency to development projects. This will
require robust diplomacy to press host governments to integrate displaced
persons in lieu of keeping them in expensive and dehumanizing camps
financed by the international community.

e Transition from large awards to expensive, inefficient, and corrupt U.N.
agencies, global NGOs, and contractors to local, especially faith-based,
entities that are already operating on the ground. This approach provides
a far less expensive and more effective alternative for aid delivery. Local
partners more ably navigate corrupt environments and are more likely
to steer vulnerable populations away from dependence on aid toward
self-sufficiency.

e Require that BHA avail itself of existing IDA authorities that it fails to use,
including to dispense with the cost-reimbursement model that disqualifies

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undercapitalized local NGOs; accept other donor vetting of local partners;
streamline the award-approval process; and expand the use of fixed-amount
awards to rein in cost overruns.

e Direct USAID’s Bureau for Management to hire more procurement officers
for BHA to strengthen the Bureau’s award management capacity and reduce
the incentives to issue large awards to aid industry giants.

e Allow BHA to manage the process of hiring Personal Services Contractors.

e Require BHA’s partners to adopt stricter vetting procedures to prevent aid
from being diverted to terrorists.

e Increase efforts to obtain greater contributions, not just pledges, for
humanitarian operations from other donors and make this a condition for
receiving additional U.S. aid.

Leveraging Foreign Aid to Unleash the Power of America’s Private Sector.
During the 1960s, when USAID was launched, 80 percent of financial flows from
the United States to the developing world was in the form of U.S. government
assistance. Today, that figure is under 10 percent, overtaken by private investment,
remittances, and private charities, all demonstrating the power of America’s pri-
vate sector to promote wealth-generating economic development in poor countries.
Leaders in the developing world routinely press U.S. officials about their preference
for “trade and investment, not aid.”

Instead, the Biden Administration is leveraging private-sector financing to
promote its climate and other progressive agendas worldwide. The next conser-
vative Administration must return USAID to a foreign aid model that leverages
its resources to promote private-sector solutions to the world’s true development
problems and end the need for future foreign aid. Private capital investment in
these markets is the greatest enabler of job creation and sustainable economic
growth throughout the developing world.

Akey tool of American soft-power leadership is the U.S. Development Finance
Corporation (DFC). Launched in December 2019, DFC sought to unleash the power
of America’s private sector to advance our interests by providing emerging markets
with blended financing opportunities to help end wretched poverty, create new
markets for U.S.-made products, strengthen bilateral partnerships in strategic
parts of the world, and offset China’s predatory loans and investments. The Trump
Administration launched a USAID-DFC Working Group to maximize development
outcomes and review individual investment projects through a counter-China lens
and ensure a cohesive interagency development response.

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As development agencies, USAID and DFC must do a better job of aligning
their respective activities and closely integrate both structurally and operation-
ally. The easiest way to foster this alignment is to “dual hat” the role of DFC’s
chief development officer so that he or she serves simultaneously in both institu-
tions. Like all U.S. federal bodies, DFC should be restored to its original intent of
deploying its commercial risk-reducing financial services instead of its current
misuse as another global vehicle to promote economy-killing climate programs,
meet irrelevant diversity objectives, and overfocus on low-impact or misguided
gender-based activities.

Branding. A deeply embedded culture within the foreign aid bureaucracy
views public recognition of U.S. assistance as secondary to a larger philanthropic
mission and is embarrassed by the American flag. Citing vaguely defined secu-
rity concerns, USAID’s implementers—U.N. agencies, international NGOs, and
contractors—often fail to credit the American people for the billions of dollars in
assistance they provide the rest of the world even as they engage in self-promoting
public relations to raise other donor funds. This approach has negative foreign
policy implications as China relentlessly promotes its own self-serving efforts to
gain influence and resources. Worst of all, malign actors sometimes appropriate
credit for unbranded U.S. assistance: Houthi terrorists, for example, claim to pro-
vide for the people under their occupation with anonymous U.S. humanitarian aid.

The United States is in a struggle for influence with China, Russia, and other
competitors, and American generosity must not go unacknowledged. The next
conservative Administration should build on the Trump Administration’s brand-
ing policy, which revamped ADS Chapter 320, to force the aid bureaucracy to fully
credit the American people for the aid they are providing. The Senior Advisor for
Brand Management in the Bureau for Legislative and Public Affairs (LPA) (dis-
cussed infra) should be a political appointee who is responsible for maximizing the
visibility of U.S. assistance by enforcing branding policy on every grant, coopera-
tive agreement, and contract. The LPA should liaise with counterparts at the U.S.
Agency for Global Media (USAGM) to ensure local media pickup of these activities.

OTHER OFFICES AND BUREAUS

Office of Administrator. The next conservative Administration should leave
in place the current structure of two presidentially appointed, Senate-confirmed
Deputy Administrators, one for Policy and one for Management. The Deputy
Administrators and the Chief of Staff must be individuals with extensive previous
service in the executive branch, ideally at foreign-affairs agencies, and be fluent in
the language and practice of federal procurement.

Bureau for Foreign Assistance. As noted above, the next conservative
Administration should name the USAID Administrator as Director of Foreign
Assistance (F) at the Department of State with the rank of Deputy Secretary. It

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2025 Presidential Transition Project

should reorient the bulk of F staff from focusing on the formulation of the annual
President’s budget proposal to the execution of already appropriated resources.
This should include eliminating the duplicative Mission and Bureau Resource
Requests; speeding up the availability of appropriations by delivering to Congress
within 60 days the report required by Section 653(a) of the Foreign Assistance Act
(FAA); and fast-tracking the approval of Congressional Notifications (CNs) and
other pre-obligation requirements.

Management Bureau. As indicated previously, the next conservative Admin-
istration should name a political appointee as USAID’s Senior Procurement
Executive and Director of the agency’s Office of Acquisition and Assistance (M/
OAA). Political appointees with the appropriate credentials (including warrants)
should be placed within M/OAA, and the agency should exercise its authority to
engage qualified experts from other federal departments and agencies and outside
of government (if they are free of conflicts of interest) on the Technical Commit-
tees that review applications for USAID’s contract and grant competitions. The
Administration should change the designation of USAID’s Competition Advocate
to an individual favorable to innovative types of contracts that can reduce the aid
oligopoly’s grip on the agency.

Office of Human Capital and Talent Management. As soon as possible after
Inauguration Day, the next conservative Administration should name a political
appointee as USAID’s Chief Human Capital Officer (CHCO) and Director of the
Office of Human Capital and Talent Management. USAID’s White House Liaison
must be an individual with substantial experience with federal personnel sys-
tems. The White House Office of Presidential Personnel should allow the USAID
Administrator to explore with counterparts at the Office of Personnel Management
whether the agency could hire personnel under both the Administratively Deter-
mined authority and Schedule C of the Excepted Service of the Federal Civil Service.

USAID should be one of the agencies to pilot-test a reinstated Executive Order
13957,° which created a Schedule F within the Excepted Service, and should aggres-
sively recruit and place candidates into term-limited positions under Schedule A
of the Excepted Service (especially veterans). The new CHCO should examine how
the existing members of the Senior Executive Service (SES) at USAID should be
reworked throughout the agency and should institute an SES Mobility Program to
encourage the regular rotation of senior career leaders, including through details
to other departments and agencies.

Bureau for Policy, Planning, and Learning. The next conservative Admin-
istration should shift the policy functions of the Bureau for Policy, Planning, and
Learning (PPL) to the Office of Budget and Resource Management (BRM), located
in the Office of the Administrator. It should rename BRM the Office of Budget,
Policy, and Resource Management (BPRM) and staff the policy team with political
appointees. The Administration should also move the responsibility for reviewing

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Mandate for Leadership: The Conservative Promise

and processing proposed changes in USAID’s policy bible, the Automated Direc-
tives System (ADS), from the Management Bureau to the new BPRM.

Even before these changes, the Assistant Administrator for PPL should decree
an immediate freeze on changes in the ADS and agencywide policy documents to
allow for the priority publication of amendments to reflect the new Administra-
tion’s viewpoint. All major agency policies should be reviewed and amended or
withdrawn within the new Administration’s first calendar year in office.

Bureau for Legislative and Public Affairs. The next conservative Admin-
istration should invest no more than 10 percent of USAID’s allocation of
Administratively Determined politically appointed positions in the Bureau for
Legislative and Public Affairs. A priority for these positions (combined with hires
under Schedule A) should be the review and editing of the agency’s public-facing
web pages and social media accounts to eliminate material that does not conform to
the new Administration’s policies. The agency should accelerate the review of Con-
gressional Notifications within LPA and publish all CNs and congressional reports.

To ensure consistency and clarity of public messaging, LPA should gain direct
authority over the communications staff scattered through USAID’s various
Bureaus and Offices. LPA should expand its public-facing efforts to include con-
servative allies that are active in global development and humanitarian aid work,
including industry groups, nonprofits, trade associations, foundations, and advo-
cacy organizations, and correspondingly reduce the aid industrial complex’s grip
on USAID’s corporate relationships.

Office of General Counsel. Along with the Director of M/OAA, the General
Counsel is one of the two or three most important positions at USAID and should
bea priority for immediate appointments. Because proper legal interpretation
of executive orders and internal USAID policy is crucial, the next conservative
Administration should recruit and appoint a commanding team of Schedule C
attorneys in the Office of the General Counsel (OGC). Within weeks of Inau-
guration Day, OGC should issue clear guidance on the eligibility of faith-based
organizations for USAID funding.

Office of Budget Resources and Management. The Director of Budget
Resources and Management should be a political appointee empowered as part of
the Administrator’s senior management team. BRM’s highest priorities should be
to prepare the report required by Section 653(a) according to the Administrator’s
guidance, institute a fast-track process for the submission of Congressional Notifica-
tions, and identify already appropriated resources to reprogram immediately to fund
the new Administration’s priorities. The next conservative Administration should
consider prioritizing the placing of young political appointees in BRM over LPA.

Bureau for Democracy, Development, and Innovation. A key outcome of
the transformation of USAID undertaken during the Trump Administration, the
Bureau for Democracy, Development, and Innovation (DDI) is the home for most

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2025 Presidential Transition Project

of the agency’s non-health, nonhumanitarian funding as well as almost all of its

sectoral appropriations directives, including those that reflect the pet projects of
individual Members of Congress. The Bureau is the policy and financial nexus at
USAID for most of the Biden Administration’s radical priorities in foreign assis-
tance, including gender, climate change, and the promotion of identity-based
politics. On the positive side, DDI is also the Bureau in charge of areas that will

be crucial to a reorientation of USAID, including trade, economic growth, inno-
vation, partnerships with the private sector, and the agency’s relationship with

communities of faith.

The next conservative Administration should make the rapid staffing of key DDI
positions a high priority. Besides the Senate-confirmed Assistant Administrator,
the Directors of each of the Centers and Hubs in the Bureau will need political
leadership. Almost every one of the agencywide policies that cover DDI’s areas of
responsibility will need to be edited or rewritten entirely as soon as possible. The
next conservative Administration should harvest DDI’s central appropriations to
fund new priorities, especially working with ethnic and religious minorities and
faith-based organizations and joint ventures with the private sector in education
and energy. All DDI programs should issue funding opportunities restricted to
new and underutilized partners modeled on the NPI.

REGIONS

Asia. Asia is the most populous continent and ground zero in the battle against
Communist China’s efforts to exploit the development needs of poor countries for
geopolitical gain. America’s Indo-Pacific Strategy should guide USAID’s approaches
to disbursing foreign aid in the region.

USAID should intensify its bilateral relationships with pro—free market Japan,
Australia, South Korea, and India so that they can jointly advance private-sector
solutions to secure financing for power generation, infrastructure, digital con-
nectivity, investment and trade expansion, and other economic activities. USAID
enjoys a strong in-country presence in India, buttressed by recent coordination
on the global response to COVID-19 as India is a global leader in vaccine produc-
tion. Those ties should be expanded. So too should development cooperation with
Taiwan, which boasts effective pandemic response capacity that should be shared
with developing countries.

China’s island-hopping efforts to capture vulnerable Pacific states is a direct
strategic threat to U.S. maritime supremacy and homeland security, and USAID
and its allied donors should neutralize these efforts through the deployment of
targeted assistance such as helping countries combat the effects of China’s ille-
gal fishing. While China outpaces the ability of the democratic alliance to deploy
state-backed financing to developing countries, it is unable to compete with our
collective private-sector capacity to deploy trillions of dollars of capital.

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Mandate for Leadership: The Conservative Promise

Pakistan is a prime example of foreign aid policies disconnected from U.S.
national interests. The country has been the recipient of more than $12 billion in
US. foreign aid since 2010, yet it remains intensely anti-American and corrupt, has
backed the Taliban continuously since 2001, jump-started North Korea’s nuclear
bomb program, brutalizes its religious minorities, and is a willing client of China
while taking on unrepayable loans from the U.S. taxpayer-funded International
Monetary Fund and World Bank.

Middle East. The Middle East is far more vulnerable today than it was in 2020
because the Biden Administration’s strategy for the region is adrift. Tunisia has
slid into autocracy, Iraq is plummeting further into Iran’s orbit, and U.S. soldiers
continue to risk their lives for unclear ends amid the ruins of Syria. Meanwhile,
billions of dollars in U.S. foreign aid props up regimes allied with Iran.

President Trump’s Abraham Accords signaled the end of the centrality of the
Arab-Israeli conflict, which paralyzed U.S. approaches to the region, and focused
instead on Iran as the principal threat to America from this region. During the
Trump Administration, USAID’s allocations reflected the new opportunities
created by the Accords and sought to strengthen regional alliances against Iran
through expanded regional trade and investment and to promote genuine polit-
ical stability tethered to strong American leadership. USAID formally partnered
with the United Arab Emirates, Israel, Morocco, Qatar, and Kuwait to catalyze
regional partnerships in Africa. Under the Biden Administration, however, USAID
has returned to a model that deepens the region’s dependence on aid.

Anew conservative President should reset USAID’s programming in the Middle
East in line with our national security interests and committed to the goal of ending
the need for foreign aid through development that is led by the private sector.
Specifically:

e Foreign aid must advance the Abraham Accords. Increased trade and
investment between Israel and its Arab neighbors represent the most
effective path toward reducing poverty, fostering the emergence of a middle
class, and solidifying peace. USAID should therefore focus its development
assistance on countries such as Morocco and Sudan through joint
investment collaboration with the more economically advanced economies
such as the UAE and Israel.

e USAID should consider cutting aid to states allied to Iran, limiting
assistance in these countries to the advancement of narrow strategic
priorities and support for basic American values, such as aid to persecuted
religious minorities. USAID continues to expend hundreds of millions of
dollars in nonhumanitarian aid to antagonistic regimes in Iraq, Lebanon,
and the Palestinian territories. After billions of dollars of aid and many

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2025 Presidential Transition Project

years of effort, these countries remain hopelessly dysfunctional—a fact
that exposes the failure of a foreign aid model that is disconnected to our
national security and without exit strategies to promote self-reliance. We
must admit that USAID’s investments in the education sector, for example,
serve no other purpose than to subsidize corrupt, incompetent, and
hostile regimes.

e USAID should undergo operational changes to secure better development
outcomes by reducing its missions’ footprints in the Middle East given that
most personnel in the region are unable to leave their highly protected and
expensive compounds and carry out their oversight functions. It should
redirect program funding away from expensive and poorly performing
international partners to more cost-effective local entities that require a
minimal USAID field presence.

Africa. Since its inception, USAID has had a strong presence in Africa, saving
millions of lives through its pandemic and infectious disease responses, especially
for malaria and HIV-AIDS. It has led global efforts to provide lifesaving emergency
assistance to those who are fleeing conflict and suffering from devastating natural
disasters. American generosity knows no equal.

Yet the agency’s efforts to reduce poverty and hunger have failed as it spends
ever-higher amounts of aid partnering with a costly and ineffective aid indus-
trial complex that has little interest in “working itself out of a job.” Long-term,
multibillion-dollar humanitarian responses lack exit strategies, while numer-
ous development projects lead neither to measurable results nor to government
reforms. Despite the tens of billions of dollars spent, the continent remains poor,
unstable, and riven with conflict, corruption, and Islamic terrorism. This situation
has also resulted in vast illegal migration from the continent.

Failure to generate wealth has provided opportunities for China to step in and
become the continent’s leader in trade, loans, and investment. As a result, Beijing
controls most of the continent’s strategic minerals that are critical to advanced
technology. Moreover, USAID is criticized by Africans for exporting cultural values
that are anathema to their traditional norms, further abetting Chinese continen-
tal supremacy.

The Biden Administration’s radical global climate policies have cut off billions
in investment to develop clean fossil fuels, denying Africa’s billion-plus people
access to cheap energy to further their own development and finance their own
social services in health, water, education, and agriculture, while increasing its
dependence on China’s renewables industry. It has exacerbated hunger by increas-
ing the costs of fertilizers to levels that many African farmers can no longer afford.
Poverty-inducing dependence on aid grows daily.

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Mandate for Leadership: The Conservative Promise

USAID efforts in Africa require a rethink. In 2025, USAID will update its five-
year Country Development and Cooperation Strategies. This will give the next
Administration an opportunity to pursue a new development course for Africa
that promotes economic self-reliance, catalyzes private-sector solutions for job
creation through increased trade and investment, terminates legacy and nonper-
forming programs, and supports diversified energy approaches. Critically, it must
hold China accountable for its extractive investments that violate international
labor, environmental, and anticorruption norms and practices; undercut business
opportunities for U.S. companies; and sabotage Africa’s development.

e USAID, in collaboration with the U.S. International Development Finance
Corporation, U.S. Department of State, U.S. Department of the Treasury,
and U.S. Department of Commerce’s Foreign Commercial Service, should
use its convening power, diplomatic heft, and risk-reducing instruments
to facilitate U.S.—African business relationships and expand Prosper Africa,
launched by the Trump Administration to “bring[] together services from
across the U.S. Government to help companies and investors do business in
US. and African markets.”!”

e The Africa Growth and Opportunity Act (AGOA)* provides Africa duty-
free access to U.S. markets. The next Administration should extend AGOA
beyond its 2025 term but within a strategic framework that rewards good
governance and pro-free market economic policies. There is no point in
wasting massive sums of aid to countries whose governments fail to keep
their promises to reform.

e USAID should build on, not compete with, private-sector initiatives
launched by global churches, corporate philanthropists, and diaspora
groups that have already invested billions of dollars in self-reliance-
based projects.

Japan has committed $30 billion in aid to Africa over three years to stem China’s
economic and political grip on the continent. Gulf-based sovereign funds also are
investing billions in African energy, infrastructure, mining, water, food production,
information and communications technology, and other strategic industries. Other
allied donors are promoting investment-based aid. There is no lack of funding to
support Africa’s economic rise. What is lacking is strategic direction among U.S.
government foreign aid agencies.

PEPFAR has saved countless lives over the years and constitutes America’s most
successful aid program. During the Trump Administration, PEPFAR increased the
share of funding to local entities from about 20 percent to nearly 70 percent with

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2025 Presidential Transition Project

commensurate improvements that have had lasting impact. The next Administra-
tion should extend that localization model to all global health and humanitarian
assistance in view of how local African entities have strengthened their capacity for
direct management of U.S. programs. Correspondingly, USAID should aggressively
ramp down its partnerships with wasteful, costly, and politicized U.N. agencies,
international NGOs, and Beltway contractors. All new programs in Africa should
build on existing local initiatives that enjoy the support of the African people.

Latin America. U.S. foreign assistance throughout the Western Hemisphere
is designed to respond to national security threats that emanate from the region,
such as illicit drug and arms trafficking; illegal immigration flows; terrorism;
pandemics; and strategic threats from China, Russia, and Iran. Over the past
decade, the United States has provided billions of dollars in security, humani-
tarian, and development assistance in Central America and the Andes, including
$1 billion in food and non-food emergency aid to millions of Venezuelan refu-
gees who have fled the Maduro dictatorship. USAID is always first to respond to
natural disasters in Central America and the Caribbean and employs a network
of dedicated experts in the region to deliver this assistance. During the COVID
pandemic, the United States provided millions of doses of vaccines and other
emergency health support.

Yet years of foreign aid have failed to bring peace, prosperity, and stability to
the hemisphere. Poverty, joblessness, and social unrest have led to leftist electoral
victories from Mexico to Chile. These regimes are hostile to American interests and
private enterprise, breed corruption, implement radical policies that will further
impoverish their people and threaten their democracies, and are more open to
striking partnerships with Communist China. Left-wing authoritarian kleptocra-
cies in Cuba, Nicaragua, and Venezuela deny their people basic freedoms, violently
and ruthlessly suppress any dissent, repress communities of faith, and generate
such misery that hundreds of thousands of their citizens have attempted to cross
our southern border over the past two years. No recent Administration has made
any progress in reducing the chaos and desperation in Haiti.

Conversely, Latin America is a major global source of energy and food, which
generates substantial income that can finance internal social and economic devel-
opment. The nations of the hemisphere share a natural and massive geographic
trade and investment advantage through their proximity to the United States,
supplemented by free-trade agreements. The United States remains the favored
destination for higher education and business opportunities for Latin Americans.
Successful diasporas in the United States serve as powerful economic, cultural,
and political bridges to every country in the region.

The Trump Administration focused on promoting trade and investment,
especially in infrastructure, through an interagency effort called América Crece
(America Grows), by which USAID played a key role in providing technical

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Mandate for Leadership: The Conservative Promise

assistance to create a more enabling environment to attract private investment.
The Biden Administration canceled the program.

The next conservative Administration should reassess all programs of U.S. for-
eign aid to Latin America and terminate those that have failed to achieve results
after years of effort. Instead, USAID should:

e Focus its resources on strengthening the fundamentals of free markets, such
as clear property rights and a functioning judiciary, and on promoting labor
and pension reforms, lower taxes, and deregulation in order to increase
trade and investment within the region and with the United States as the
genuine path to economic and political stability.

e Challenge the socialist ideas that have captured too many of the region’s
governments and their nations’ youth.

e Fund partnerships with the private sector and support civil-society groups,
including university centers and think tanks that advocate for pro-free
market and democratic ideas.

Finally, Latin America is the perfect proving ground for reducing USAID’s reli-
ance on large U.S.-based implementers, and the agency should commit to shifting
all of its portfolio in the region to local organizations by 2030.

PERSONNEL

The Trump Administration agenda for USAID was undercut from the outset
both by recalcitrant career personnel and by inexperienced political personnel.
The next conservative Administration should implement personnel policies from
the beginning so that the agency can be effectively managed according to high stan-
dards. The rapid deployment of reforms will require key experienced personnel
installed quickly at USAID’s headquarters and missions. Delay will only impede
progress. In general, areas of focus should be appointing effective lawyers in key
positions, reforming career hiring/firing mechanisms, and getting a grip on the
grantmaking process.

The Administration should staff the Office of the General Counsel with at least
four politically appointed attorneys (besides the General Counsel). The General
Counsel should have two political deputies, one of whom should cover Human
Capital and Talent Management (HCTM) and the other the Office of Acquisition
and Assistance (OAA).

The Administration should name a political appointee with long experience in
federal personnel systems as USAID’s Chief Human Capital Officer and Director
of HCTM. This appointee would help to scope and shepherd position descriptions,

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2025 Presidential Transition Project

clearances, and other components of the hiring process that are necessary for
immediate onboarding while coordinating with the White House to bring in new
appointees and make internal career employee changes. On Day One, USAID
should halt all agencywide training and replace it with training modules to advance
the President’s agenda.

The Administration should appoint a Senior Accountable Official (SAO) to
report on the agency’s adherence to Administration policy priorities, including on
Protecting Life in Foreign Assistance, critical race theory, climate change, gender,
and diversity and inclusion. It should also create a program to staff hard-to-fill
positions overseas.

Finally, the Administration should create a recruiting program for veterans
and other groups to participate in career job opportunities at USAID. Former mis-
sionaries, veterans, members of diasporas, and faith community stakeholders with
overseas experience should be recruited to work at USAID on Schedule A appoint-
ments, as Institutional Services Contractors, as Personal Services Contractors, and
as Foreign Service Officers.

CONCLUSION

The next conservative Administration will have a unique opportunity to realign
US. foreign assistance with American national interests and the principles of good
governance and more accurately reflect the U.S. taxpayer’s unmatched charita-
ble desire to help those in need. It can build on a strong baseline of conservative
reforms undertaken by the Trump Administration to counter Communist China’s
strategy of world domination. However, this will require that bold steps are taken
on Day One to undo the gross misuse of foreign aid by the current Administration
to promote a radical ideology that is politically divisive at home and harms our
global standing.

AUTHOR'S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in
the 2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume,
but Dr. William Steiger, Bethany Kozma, and Dr. Alma Golden deserve special mention. The author assumes
full responsibility for the content of this chapter, and no views expressed therein should be attributed to any
other individual.

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Mandate for Leadership: The Conservative Promise

ENDNOTES

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— 281—

Section Three

THE GENERAL WELFARE

hen our Founders wrote in the Constitution that the federal government

would “promote the general Welfare,” they could not have fathomed a

massive bureaucracy that would someday spend $3 trillion in a single

year—roughly the sum, combined, spent by the departments covered in this section

in 2022. Approximately half of that colossal sum was spent by the Department of

Health and Human Services (HHS) alone—the belly of the massive behemoth that
is the modern administrative state.

HHS is home to Medicare and Medicaid, the principal drivers of our $31 trillion
national debt. When Congress passed and President Lyndon B. Johnson signed
into law these programs, they were set on autopilot with no plan for how to pay
for them. The first year that Medicare spending was visible on the books was 1967.
From that point on through 2020—according to the American Main Street Initia-
tive’s analysis of official federal tallies—Medicare and Medicaid combined cost $17.8
trillion, while our combined federal deficits over that same span were $17.9 trillion.
In essence, our deficit problem is a Medicare and Medicaid problem.

HHS is also home to the Centers for Disease Control and Prevention (CDC)
and the National Institutes of Health (NIH), the duo most responsible—along
with President Joe Biden—for the irrational, destructive, un-American mask and
vaccine mandates that were imposed upon an ostensibly free people during the
COVID-19 pandemic. All along, it was clear from randomized controlled trials—
the gold standard of medical research—that masks provide little to no benefit in
preventing the spread of viruses and might even be counterproductive. Yet the
CDC ignored these high-quality RCTs, cherry-picked from politically malleable

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“observational studies,” and declared that everyone except children and infants
below the age of two should don masks. Under COVID, as former director of HHS’s
Office of Civil Rights Roger Severino writes in Chapter 14, the CDC exposed itself
as “perhaps the most incompetent and arrogant agency in the federal government.”

Nor is the CDC the only villain in this play. Severino writes of the National
Institutes of Health, “Despite its popular image as a benign science agency, NIH
was responsible for paying for research in aborted baby body parts, human animal
chimera experiments”—in which the genes of humans and animals are mixed, “and
gain-of-function viral research that may have been responsible for COVID -19.”
Severino writes that “Anthony Fauci’s division of the NIH”—the National Institute
of Allergy and Infectious Diseases—“owns half the patent for the Moderna COVID-
19 vaccine,” and “several NIH employees” receive “up to $150,000 annually from
Moderna vaccine sales.” That would be the same experimental mRNA vaccine that
the CDC now wants to force on children, who are at little to no risk from COVID-19
but at great risk from public health officials.

The incestuous relationship between the NIH, CDC, and vaccine makers—with
all of the conflict of interest it entails—cannot be allowed to continue, and the
revolving door between them must be locked. As Severino writes, “Funding for
scientific research should not be controlled by a small group of highly paid and
unaccountable insiders at the NIH, many of whom stay in power for decades. The
NIH monopoly on directing research should be broken.” What’s more, NIH has long

“been at the forefront in pushing junk gender science.” The next HHS secretary
should immediately put an end to the department’s foray into woke transgen-
der activism.

HHS also pushes abortion as a form of “health care,” skirting and sometimes
blatantly defying the Hyde Amendment in the process. Severino writes that the
“FDA should...reverse its approval of chemical abortion drugs because the polit-
icized approval process was illegal from the start.” In addition, HHS programs
often violate the spirit, and sometimes the letter, of conscience-protection laws.
Severino writes that the HHS “Secretary should pursue a robust agenda to pro-
tect the fundamental right to life, protect conscience rights, and uphold bodily
integrity rooted in biological realities, not ideology.” The next secretary should
also reverse the Biden Administration’s focus on ““LGBTQ+ equity, subsidizing
single-motherhood, disincentivizing work, and penalizing marriage,” replacing
such policies with those encouraging marriage, work, motherhood, fatherhood,

and nuclear families.

If there is another department that has gone off the rails like HHS during the
Obama and Biden Administrations, it is the once proud Department of Justice
(DOJ). As former counselor to the attorney general Gene Hamilton writes in Chap-
ter 17, the department “has a long and noble history”—Edmund Randolph, the
first attorney general, took office the same year as President Washington—yet its

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longstanding reputation has been marred by the Biden Administration’s abuse of
the department’s powers for its own ends. Hamilton writes that the department’s

“unprecedented politicization and weaponization” under Biden and Attorney
General Merrick Garland, resulting in “politically motivated and viewpoint-based
prosecutions” of political enemies and indifference to the crimes of political allies,
has made the department “a threat to the Republic.” The most important thing for
the next attorney general to do is to refocus the department on its core functions of

“protecting public safety and defending the rule of law,” while restoring its “values
of independence, impartiality, honesty, integrity, respect, and excellence.”

This is especially true of the Federal Bureau of Investigations (FBI). A bloated,
arrogant, increasingly lawless organization, especially at the top, “the FBI views
itself as an independent agency” that is “on par with the Attorney General,” rather
than as an agency that is under the AG and fully accountable to him or her. To rein
in this “completely out of control” bureau and remind it of its place within—rather
than at the top of—the DOJ hierarchy, Hamilton writes that the FBI’s separate
Office of General Counsel (with “approximately 300 attorneys”), separate Office
of Legislative Affairs, and separate Office of Public Affairs should all be abolished.
Requiring the FBI to get its legal advice from the wider department “would serve
as acrucial check on an agency that has recently pushed past legal boundary after
legal boundary.” Indeed, Hamilton writes, “[t]he next conservative Administra-
tion should eliminate any offices within the FBI that it has the power to eliminate
without any action from Congress.”

Elsewhere, DOJ should target violent and career criminals, not parents; work
to dismantle criminal organizations, partly by rigorously prosecuting interstate
drug activity; and restart the Trump Administration’s “China Initiative” (to address
Chinese espionage and theft of trade secrets), which the Biden Administration “ter-
minated...largely out of a concern for poor “optics.” It should also enforce existing
federal law that prohibits mailing abortifacients, rather than harassing pro-life
demonstrators; respect the constitutional guarantee of the freedom of speech,
rather than trying to police speech on the internet; and enforce federal immigra-
tion laws, rather than pretending there is no border.

In contrast to DOJ’s long history, the Department of Education (the depart-
ment, or ED), discussed by Lindsey Burke in Chapter 11, is a creation of the Jimmy
Carter Administration. The department is a convenient one-stop shop for the woke
education cartel, which—as the COVID era showed—is not particularly concerned
with children’s education. Schools should be responsive to parents, rather than to
leftist advocates intent on indoctrination—and the more the federal government
is involved in education, the less responsive to parents the public schools will be.
This department is an example of federal intrusion into a traditionally state and
local realm. For the sake of American children, Congress should shutter it and
return control of education to the states.

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Short of this, the Secretary of Education should insist that the department
serve parents and American ideals, not advocates whose message is that children
can choose their own sex, that America is “systemically racist,” that math itself
is racist, and that Martin Luther King, Jr.’s ideal of a colorblind society should
be rejected in favor of reinstating a color-conscious society. The next head of
this department will have a lot to do—hopefully culminating in the department’s
closure and the salutary restoration of educational control to states, localities,
and parents.

The next Secretary of Energy will similarly have much work to do. Under the
next President, the Department of Energy should end the Biden Administration’s
unprovoked war on fossil fuels, restore America’s energy independence, oppose
eyesore windmills built at taxpayer expense, and respect the right of Americans
to buy and drive cars of their own choosing, rather than trying to force them
into electric vehicles and eventually out of the driver’s seat altogether in favor of
self-driving robots. As former commissioner of the Federal Energy Regulatory
Commission Bernard L. McNamee says in Chapter 12, “A conservative President
must be committed to unleashing all of America’s energy resources and making
the energy economy serve the American people, not special interests.”

In Chapter 10, Daren Bakst writes that the Biden Administration’s Department
of Agriculture claims to be “transforming the food system as we knowit.” But the
government “does not need to transform the food system”; instead, “it should
respect American farmers, truckers,” and families. In Chapter 13, former chief of
staff at the Environmental Protection Agency Mandy Gunasekara writes that the
EPA’s “current activities and staffing levels far exceed its congressional mandates
and purpose,” whereas its “initial success” in its “infancy” Gin the 1970s) was a
product of “clear mandates, a streamlined structure, [and] recognition of the states’
prominent role.” Having since become a “coercive” agency, full of embedded activ-
ists, its “structure and mission should be greatly circumscribed.”

Former secretary of the Department of Housing and Urban Development Dr.
Benjamin S. Carson writes in Chapter 15 that HUD is beset with “mission creep”
and regularly crosses the line into exercising quasi-legislative powers. In the next
Administration, it should refocus on its core duties and keep “noncitizens...from
living in federally assisted housing,” provide enhanced “oversight of foreign own-
ership of [U.S.] real estate,” and “reinvigorate paths to upward economic mobility”
and economic “self-sufficiency.” In Chapter 18, former acting assistant secretary
of policy at the Department of Labor Jonathan Berry writes that the department
and related agencies should pursue pro-family, pro-worker policies to help “restore
the family-supporting job as the centerpiece of the American economy,” in lieu of
the current Administration’s “left-wing social-engineering agenda”—“the most
assertive” in history—which empowers race, gender, and climate-change activists
at the expense of American workers.

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In Chapter 19, on the Department of Transportation (DOT), former DOT deputy
assistant director for research and technology Diana Furchtgott-Roth writes, “In
pursuit of an anti-fossil-fuel climate agenda never approved by Congress, the Biden
Administration has raised fuel economy requirements to levels that cannot real-
istically be met” by most gas-powered cars, thereby reducing Americans’ freedom
while increasing costs. Lastly, former acting chief of staff at the Department of
Veterans Affairs Brooks D. Tucker, echoing concerns expressed in other chapters,
writes in Chapter 20 that the Veterans Affairs (VA) must be “accountable to the
needs and problems of veterans, not subservient to the parochial preferences of
the bureaucracy.”

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DEPARTMENT OF
AGRICULTURE

Daren Bakst

merican farmers efficiently and safely produce food to meet the needs of

individuals around the globe. Because of the innovation and resilience

of the nation’s farmers, American agriculture is a model for the world. If

farmers are allowed to operate without unnecessary government intervention,

American agriculture will continue to flourish, producing plentiful, safe, nutritious,
and affordable food.

The U.S. Department of Agriculture (USDA) can and should play a limited role,
with much of its focus on removing governmental barriers that hinder food pro-
duction or otherwise undermine efforts to meet consumer demand. The USDA
should recognize what should be self-evident: Agricultural production should first
and foremost be focused on efficiently producing safe food.

This chapter provides important background on the USDA and identifies many
of the USDA-specific issues that will be faced by an incoming Administration. It
provides specific recommendations for the next Administration about how to
address these issues and lays out a conservative vision for what the USDA should
look like in the future.

MISSION STATEMENT
The current mission statement as stated by the Biden Administration highlights

the broad scope of the USDA:

To serve all Americans by providing effective, innovative, science-based
public policy leadership in agriculture, food and nutrition, natural resource

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protection and management, rural development, and related issues witha
commitment to delivering equitable and climate smart opportunities that
inspire and help America thrive.'

The first part of the mission statement regarding the issues covered is not new
to the Biden Administration; it reflects the overly broad nature of the USDA’s work.
However, the language bringing in equity and climate change is new to the Biden
Administration and part of the USDA’s express effort to transform agricultural
production.’

The USDA’s new vision statement illuminates the focus of this effort:

An equitable and climate smart food and agriculture economy that protects and
improves the health, nutrition and quality of life of all Americans, yields healthy
land, forests and clean water, helps rural America thrive, and feeds the world.*

This effort is one of a federal central plan to put climate change and envi-
ronmental issues ahead of the most important requirements of agriculture—to
efficiently produce safe food. The USDA would apparently use its power to change
the very nature of the food and agriculture economy into one that is “equitable and
climate smart.” As an initial matter, the USDA should not try to control and shape
the economy, but should instead remove obstacles that hinder food production.
Further, it should not place ancillary issues, such as environmental issues, ahead
of agricultural production itself.

A Proper Mission Statement. Even before the Biden Administration’s rad-
ical effort to reshape the USDA’s work, the USDA’s mission was and is too broad,
including serving as a major welfare agency through implementation of programs
such as food stamps. This far-reaching mission is not the fault of the USDA, but of
Congress, which has given the department its extensive power.

Congress must limit the USDA’s role. A proper mission would clarify that the
department’s primary focus is on agriculture and that the USDA serves all Amer-
icans. The USDA’s “client” is the American people in general, not a subset of
interests, such as farmers, meatpackers, environmental groups, etc.

Within this agricultural focus, the USDA should develop and disseminate
information and research (the historical role of the USDA); identify and address
concrete threats to public health and safety arising directly from food and agri-
culture; remove unjustified foreign trade barriers blocking market access for
American agricultural goods; and generally remove government barriers that
undermine access to safe and affordable food across the food supply chain.

Core principles should be included within any mission statement, including
a recognition that farmers, and the food system in general, should be free from
unnecessary government intervention. Further, there should be clear statements

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about the importance of sound science to inform the USDA’s work and respect for
personal freedom and individual dietary choices, private property rights, and the
rule of law.

Taking these factors into account, below is a model USDA mission statement:

To develop and disseminate agricultural information and research, identify and
address concrete public health and safety threats directly connected to food and
agriculture, and remove both unjustified foreign trade barriers for U.S. goods
and domestic government barriers that undermine access to safe and affordable
food absent a compelling need—all based on the importance of sound science,
personal freedom, private property, the rule of law, and service to all Americans.

OVERVIEW

In 1862, President Abraham Lincoln signed into law the legislation that created
the USDA.* The department had a very narrow mission focused on the dissemi-
nation of information connected to agriculture and “to procure, propagate and
distribute among the people new valuable seeds and plants.”® During the last 160
years, the scope of the USDA’s work has expanded well beyond that narrow mis-
sion—and well beyond agriculture itself. In addition to being a distributor of farm
subsidies, the USDA runs the food stamp program and other food-related wel-
fare programs and covers issues including conservation, biofuels, forestry, and
rural programs.

Based on the USDA’s fiscal year (FY) 2023 budget summary, outlays are esti-
mated at $261 billion: $221 billion for mandatory programs and $39 billion for
discretionary programs.° These outlays are broken down as follows: nutrition assis-
tance (70 percent); farm, conservation, and commodity programs (14 percent); “all
other,” which includes rural development, research, food safety, marketing and
regulatory, and departmental management (11 percent); and forestry (5 percent).”

The USDA has provided a summary of its size, explaining, “Today, USDA is com-
prised of 29 agencies organized under eight Mission Areas and 16 Staff Offices,
with nearly 100,000 employees serving the American people at more than 6,000
locations across the country and abroad.”8

MAJOR PRIORITY ISSUES AND SPECIFIC RECOMMENDATIONS

For an incoming Administration, there are numerous issues that should be
addressed at the USDA. This chapter identifies and discusses many of the most
important issues. The initial issues discussed should be priority issues for the next
Administration:

Defend American Agriculture. It is deeply unfortunate that the first issue
identified must be a willingness of the incoming Administration to defend Amer-
ican agriculture, but this is precisely what the top priority for that Administration

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should be. As previously discussed, the Biden Administration is seeking to use
the federal government to transform the American food system.’ The USDA web
site explains:

The U.S. Department of Agriculture (USDA), alongside Biden—Harris
Administration leadership and the people of this great country, has embarked
on another historic journey: transforming the food system as we know it—
from farm to fork, and at every stage along the supply chain."°

The federal government does not need to transform the food system or develop
a national plan to intervene across the supply chain. Instead, it should respect
American farmers, truckers, and everyone who makes the food supply chain so
resilient and successful. One of the important lessons learned during the COVID-
19 pandemic was how critical it is to remove barriers in the food supply chain—not
to increase them.

The Biden Administration’s centrally planned transformational effort mini-
mizes the importance of efficient agricultural production and instead places issues
such as climate change and equity front and center. The USDA’s Strategic Plan
Fiscal Years 2022-2026 identifies six strategic goals, the first three of which focus
on issues such as climate change, renewable energy, and systemic racism. In the
Secretary of Agriculture’s message, there is only one mention of affordable food—
and nothing about efficient production and the incredible innovation and respect
for the environment that already exists within the agricultural community.”

The Biden Administration’s USDA strongly supported” the recent United
Nations (U.N.) Food Systems Summit. According to the USDA:

The stated goal of the Food Systems Summit was to transform the way the
world produces, consumes and thinks about foods within the context of the
2030 Agenda for Sustainable Development and to meet the challenges of
poverty, food security, malnutrition, population growth, climate change, and
natural resource degradation."

Not unlike those who oppose reliable and affordable energy production, there
is a disdain, especially by some on the Left, for American agriculture and the food
system.“ The Biden Administration’s vision of a federal government developing
a plan that “fixes” agriculture and focuses on issues secondary to food production
is very disturbing.

A recent USDA-created program captures both the disrespect for American
farmers and the Biden Administration’s effort to dictate agricultural practices.
The USDA explained that it was concerned with farmers not transitioning to
organic farming, and therefore announced that it will dedicate $300 million to

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induce farmers to adopt organic farming.’® There was no recognition that farmers
know how to farm better than D.C. politicians" or a that organic food is expensive”
and land-intensive.’* The Biden Administration has also been pushing so-called

“climate-smart”” agricultural practices which received additional support in the
partisan Inflation Reduction Act.”°

American agriculture should not need defending. According to the USDA’s latest
data, farm output nearly tripled (a 175 percent increase) from 1948 to 2019, while
the amount of land farmed decreased. In fact, as farm output increased by 175
percent, a// agricultural inputs increased by only 4 percent.”

In 2021, despite high food prices—a major problem and regressive—Ameri-
can consumers spent an average of about 10 percent of their personal disposable
income on food, which is close to historic lows. For decades, this share has been in
decline.”? America’s farmers efficiently produce food using fewer resources, making
it possible for food to be affordable. This reality is not only something that should
be defended but also touted as a prime example of what makes American agricul-
ture so successful. The connection between efficiency and affordability seems lost
in the Biden Administration’s effort to transform the food system.

RECOMMENDATIONS

Proactively Defend Agriculture. From the outset, the next Administration
should: Denounce efforts to place ancillary issues like climate change ahead of
food productivity and affordability when it comes to agriculture.

e Remove the US. from any association with U.N. and other efforts to push
sustainable-development schemes connected to food production.

e Defend American agriculture and advance the critical importance of
efficient and innovative food production, especially to advance safe and
affordable food.

e Stress that ideal policy should remove obstacles imposed on American
farmers and individuals across the food supply chain so that they can meet
the food needs of Americans.

e Clarify the critical importance of efficiency to food affordability, and why a
failure to recognize this fact especially hurts low-income households who
spend a disproportionate share of after-tax income on food compared to
higher-income households.”

To accomplish these objectives, anew Administration should announce its
principles through an executive order, the USDA should remove all references

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to transforming the food system on its web site and other department-dis-
seminated material, and it should expressly and regularly communicate the
principles informing the objectives listed above, as well as promote these prin-
ciples through legislative efforts. The USDA should also carefully review existing
efforts that involve inappropriately imposing its preferred agricultural practices
onto farmers.

Address the Abuse of CCC Discretionary Authority. With the exception of
federal crop insurance, the Commodity Credit Corporation (CCC) is generally the
means by which agricultural-related farm bill programs are funded. The CCC isa
funding mechanism, which, in simple terms, has $30 billion a year at its disposal.”*

Section 5 of the Commodity Credit Corporation Charter Act (Charter Act)”
gives the Secretary of Agriculture broad discretionary authority to spend “unused”
CCC money. However, in general, past Agriculture Secretaries have not used this
power to any meaningful extent. This changed dramatically during the Trump
Administration, when this discretionary authority was used to fund $28 billion
in “trade aid” to farmers, consisting primarily of the Market Facilitation Program.
In 2020, this authority was used for $20.5 billion in food purchases and income
subsidies in response to the COVID-19 pandemic.”°

At the time, critics warned that this use of the CCC, which in effect created a
USDA slush fund, would lead future Administrations to abuse the CCC, such as
by pushing climate-change policies.” Predictably, this is precisely what the Biden
Administration has done, using the discretionary authority to create programs
out of whole cloth, arguably without statutory authority,” for what it refers to as
climate-smart agricultural practices.”

The merits of the various programs funded through the CCC discretionary
authority is not the focus of this discussion. The major problem is that the Secre-
tary of Agriculture is empowered to use a slush fund. Billions of dollars are being
used for programs that Congress never envisioned or intended.

Concern about this type of abuse is not new. In fact, from 2012 to 2017, Congress
expressly limited the Agriculture Secretary’s discretionary spending authority
under the Charter Act.*° And this was before the recent massive discretionary CCC
spending occurred.

The use of the discretionary power is a separation of powers problem, with
Congress abrogating its spending power. This power is ripe for abuse—as could be
expected with any slush fund—and it is a possible way to get around the farm bill
process to achieve policy goals not secured during the legislative process.

The next Administration should:

e =©6Refrain from using section 5 discretionary authority. The USDA can

address this abuse on its own by following the lead of most Administrations
and not using this discretionary authority.

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e Promote legislative fixes to address abuse. Ideally, Congress would
repeal the Secretary’s discretionary authority under section 5 of the Charter
Act. There is no reason to maintain such authority. If Congress needs to
spend money to assist farmers, it has legislative tools, including the farm bill
and the annual appropriations process, to do so in a timely fashion. While
not an ideal solution, Congress could also amend the Charter Act to require
prior congressional approval through duly enacted legislation before any
money is spent.

At a minimum, Congress should amend the Charter Act to:

e Limit spending to directly help farmers and ranchers address issues due
to unforeseen events not already covered by existing programs and that
constitute genuine emergencies that must be addressed immediately.

e Prohibit the CCC from being used to assist parties beyond farmers and ranchers.

e Clarify that spending is only to address problems that are temporary in
nature and ensure that funding is targeted to address such problems.

e Tighten the discretion within section 5 and identify ways for improper
application of the Charter Act to be challenged in court.

Reform Farm Subsidies. Too often, agricultural policy becomes synonymous
with farm subsidy policy. This is unfortunate, because making them synony-
mous fails to recognize that agricultural policy covers a wide range of issues,
including issues that are outside the proper scope of the USDA, such as environ-
mental regulation.

However, there is no question that farm subsidies are an important issue
within agricultural policy that should be addressed by any incoming Adminis-
tration. There are several principles that even subsidy supporters would likely
agree upon, including the need to reduce market distortions. Subsidies should not
influence planting decisions, discourage proper risk management and innovation,
incentivize planting on environmentally sensitive land, or create barriers to entry
for new farmers. Farm subsidies can lead to these market distortions and there-
fore, it would hardly be controversial to ensure that any subsidy scheme should
be designed to avoid such problems.

The overall goal should be to eliminate subsidy dependence. Despite what
might be conventional wisdom, many farmers receive few to no subsidies, with
most subsidies going to only a handful of commodities. According to the Congres-
sional Research Service (CRS), from 2014 to 2016, 94 percent of farm program

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support went to just six commodities—corn, cotton, peanuts, rice, soybeans, and
wheat—that together account for only 28 percent of farm receipts.*” Although many
farmers do not receive much in the way of subsidies, especially those in the areas
of livestock and specialty crops (fruit, vegetable, and nuts),** there are still a sig-
nificant number of farmers growing row crops like corn and cotton that do receive
significant farm subsidies.

The primary subsidy programs include the Agriculture Risk Coverage (ARC)
program,” the Price Loss Coverage (PLC) program,” and the federal crop insur-
ance program.*° Farmers can participate on a crop-by-crop basis in the ARC
program or the PLC program. These programs cover about 20 different crops.*” The
ARC program protects farmers from what are referred to as “shallow” losses, pro-
viding payments when their actual revenues fall below 86 percent of the expected
revenues for their crops.** The PLC program provides payments to farmers when
commodity prices fall below a fixed, statutorily established reference price.*°

The federal crop insurance program is broader in scope than ARC and PLC,
and in crop year 2019 covered 124 commodities.*° Farmers pay a portion of a
premium to participate in the program. Taxpayers on average pay about 60 per-
cent* of the premium. As explained by CRS, “Revenue Protection was the most
frequently purchased policy type in 2019, accounting for almost 70 [percent] of
policies purchased.”

While there are certainly other subsidy programs besides ARC, PLC, and federal
crop insurance, one program that deserves special mention is the federal sugar
program. This program, unlike most other subsidy programs, intentionally tries
to restrict supply* and thereby drives up prices. The program costs consumers as
much as $3.7 billion a year.

When it comes to reforming subsidy programs, the next Administration will
primarily have to look to legislative solutions. The next Administration should
champion legislation that would:

e Repeal the federal sugar program. The federal government should
not be in the central planning business, and the sugar program is a prime
example of harmful central planning. Its very purpose is to limit the sugar
supply in order to increase prices. The program has a regressive effect, since
lower-income households spend more of their money to meet food needs
compared to higher income households.**

e Ideally, repeal the ARC and PLC programs. Farmers eligible to
participate in ARC or PLC are generally already able to purchase federal
crop insurance, policies that protect against shortfalls in expected revenue
whether caused by lower prices or smaller harvests. The ARC program is
especially egregious because farmers are being protected from shallow

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losses, which is another way of saying minor dips in expected revenue.
This is hardly consistent with the concept of providing a safety net to help
farmers when they fall on hard times. The Congressional Budget Office
(CBO), in one of its options to reduce the federal deficit, has once again
identified repealing all Title I farm programs, including ARC, PLC, and the
federal sugar program.”

Stop paying farmers twice for price and revenue losses during the
same year. Farmers can receive support from the ARC or PLC programs
and the federal crop insurance program to cover price declines and revenue
shortfalls during the same year. Congress should prohibit this duplication by
prohibiting farmers from receiving an ARC or PLC payment the same year
they receive a crop insurance indemnity.

Reduce the premium subsidy rate for crop insurance. On average,
taxpayers cover about 60 percent” of the premium cost for policies
purchased in the federal crop insurance program. One of the most widely
supported and bipartisan policy reforms is to reduce the premium subsidy
that taxpayers are forced to pay.** At a minimum, taxpayers should not pay
more than 50 percent of the premium. After all, taxpayers should not have
to pay more than the farmers who benefit from the crop insurance policies.

CBO has found that reducing the premium subsidy to 47 percent would
save $8.1 billion over 10 years and have little impact on crop insurance
participation or on the number of covered acres.*° In that analysis, there
would be a reduction in insured acres of just one-half of 1 percent, and

only 1.5 percent of acres would have lower coverage levels. °° This reform

is basically all benefit with little to no cost. In its recently released report
identifying options to reduce the federal deficit, CBO found that reducing
the premium subsidy to 40 percent would save $20.9 billion over 10 years.”

Beyond these legislative reforms, the next Administration should:

Communicate to Congress the necessity of transparency and a genuine
reform process. The White House and the USDA should make it very clear
that the farm bill process, including reform of farm subsidies, must be con-
ducted through an open process with time for mark-up and the opportunity
for changes to be made outside the Agriculture Committee process.

The farm bill too often is developed behind closed doors and without any
chance for real reform. The White House, given the power of the bully pulpit,

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must demand a genuine reform process and express unwavering support
for a USDA that shapes a safety net that considers the interests of farmers,
while also remembering the interests of taxpayers and consumers. Any
safety net for farmers should be a true safety net—one that helps farmers
when they have experienced serious unforeseen losses (preferably when
there has been a disaster or unforeseen natural event causing damage) and
that exists to help them in unusual situations.

e Separate the agricultural provisions of the farm bill from the
nutrition provisions. To have genuine reform and proper consideration
of the issues, agricultural programs should be considered in separate
legislation distinct from food stamps and the nutrition part of the farm bill,
and reauthorization of such programs should be fixed on different timelines
to ensure this separation. Agricultural and nutritional programs, which are
distinct from each other, have been combined together for political reasons,
something which is readily admitted by proponents of this logrolling. When
it comes to American agriculture and welfare programs, they deserve sound
policy debates, not political tactics at the expense of thoughtful discourse.

Move the Work of the Food and Nutrition Service. The USDA implements
many means-tested federal support programs, including the largest food assis-
tance program, Supplemental Nutrition Assistance Program (SNAP, also known
as food stamps), and the Special Supplemental Nutrition Program for Women,
Infants, and Children (WIC) Food Program. The Food and Nutrition Service (FNS)
oversees these programs and other food and nutrition programs, including the
Center for Nutrition Policy and Promotion,” which handles the USDA’s work on
the “Dietary Guidelines for Americans” (Dietary Guidelines).** Food nutrition
programs include: SNAP; WIC; the National School Lunch Program (NSLP); the
School Breakfast Program (SBP); the Child and Adult Care Food Program; the
Nutrition Program for the Elderly; Nutrition Service Incentives; the Summer Food
Service Program; the Commodity Supplemental Food Program; the Temporary
Emergency Food Program; the Farmer’s Market Nutrition Program; and the Spe-
cial Milk Program.

The next Administration should:

e Move the USDA food and nutrition programs to the Department of
Health and Human Services. There are more than 89 current means-
tested welfare programs, and total means-tested spending has been
estimated to surpass $1.2 trillion between federal and state resources.**
Because means-tested federal programs are siloed and administered in
separate agencies, the effectiveness and size of the welfare state remains

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largely hidden. There are means-tested food-support programs in the
USDA (specially FNS), whereas most means-tested programs are at the
Department of Health and Human Services (HHS). All means-tested anti-
poverty programs should be overseen by one department—specifically HHS,
which handles most welfare programs.

Reform SNAP. Ostensibly, SNAP sends money through electronic-bene-

fit-transfer (EBT) cards to help “low-income” individuals buy food. It is the largest
of the federal nutrition programs. Food stamps are designed to be supplemented by

other forms of income—whether through paid employment or nonprofit support.
SNAP serves 41.1 million individuals—an increase of 4.3 million people during the
Biden years.* In 2020, the food stamp program cost $79.1 billion. That number
continued to rise—by 2022, outlays hit $119.5 billion.*°

The next Administration should:

Re-implement work requirements. The statutory language covering
food stamps allows states to waive work requirements that otherwise
apply to work-capable individuals—that is, adult beneficiaries between the
ages 18 and 50 who are not disabled and do not have any children or other
dependents in the home.*”

Even in a strong economy, work expectations are fairly limited: Individuals
who are work-capable and without dependents are required to work or
prepare for work for 20 hours per week.** The work requirements are then
implemented unless the state requests a waiver from the USDA’s Food and
Nutrition Services.*? Waivers from statutory work requirements can be
approved in two instances: an unemployment rate of more than 10 percent
or a lack of sufficient jobs.

The Trump Administration bolstered USDA work expectations in the

food stamp program. In February 2019, FNS issued a modest regulatory
change that applied only to able-bodied individuals without dependents—
beneficiaries aged 18 to 49, not elderly or disabled, who did not have children
or other dependents in the home (ABAWD).°! The FNS rule changed

when a state could receive a waiver from implementing the ABAWD work
requirement.

Under the new rule, in order to waive the work requirement, the state’s
unemployment rate had to be above 6 percent for more than 24 months.
The rule also defined “area” in such a way that states would be unable to
combine non-contiguous counties in order to maximize their waivers. Of

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the more than 40 million food stamp beneficiaries, the Trump rule would
have applied only to 688,000 individuals in fiscal year 2021.°

The Trump reform was scheduled to go into effect, but a D.C. district court
federal judge enjoined the rule.** The USDA filed an appeal in late December
2020,” but the Biden Administration withdrew from defending the
challenge, and the rule was never implemented.

Beyond the able-bodied work requirement, FNS should implement better
regulation to clarify options for states to implement the general work
requirement. This requirement is an option states can apply to work-
capable beneficiaries aged 16 to 59. If beneficiaries’ work hours are below

30 hours a week, states can implement the general work requirements to
oblige beneficiaries to register for work or participate in SNAP Employment
and Training or workfare assigned by the state SNAP agency.” Increased
clarity for states would include items like states being required to offer
employment and training spots for those that request them—not simply
budgeting for every currently enrolled able-bodied adult.

Reform broad-based categorical eligibility. Federal law permits states
to enroll individuals in food stamps if they receive a benefit from another
program, such as the Temporary Assistance for Needy Families (TANF)
program. However, under an administrative option in TANF called broad-
based categorical eligibility (BBCE), ”benefit” is defined so broadly that it
includes simply receiving distributed pamphlets and 1-800 numbers.® This
definition, with its low threshold to trigger a “benefit,” allows individuals to
bypass eligibility limits—particularly the asset requirement (how much the
applicant has in resources, such as bank accounts or property).°’ Adopting
the BBCE option has even allowed millionaires to enroll in the food

stamp program.”

The Trump Administration proposed to close the loophole with a rule
to “increase program integrity and reduce fraud, waste, and abuse.””! The
regulation was not finalized before the end of the Trump Administration.

Re-evaluate the Thrifty Food Plan. In a dramatic overreach, the Biden
Administration unilaterally increased food stamp benefits by at least 23
percent in October 2021.” Through an update to the Thrifty Food Plan, in
which the USDA analyzes a basket of foods intended to provide a nutritious
diet, the USDA increased food stamp outlays by between $250 billion and
$300 billion over 10 years.”

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Although the 2018 farm bill instructed FNS to update the Thrifty Food Plan
by 2023 and every five years thereafter, every previous Thrifty Food Plan
has been always cost-neutral (just an inflation update)—exactly what CBO
estimated as cost of the 2018 farm bill.”

The Biden Administration may have skirted regulations and congressional
authority to increase the overall cost of the program. In fact, Senate and
House Republicans requested that the Government Accountability Office
investigate the legal authorities and process that the USDA undertook to
arrive at such an unprecedented increase.”

e Eliminate the heat-and-eat loophole. States can artificially boost a
household’s food stamp benefit by using the heat-and-eat loophole. The
amount of food stamps a household receives is based on its “countable”
income (income minus certain deductions). Households that receive
benefits from the Low-Income Heat and Energy Assistance Program
(LIHEAP) are eligible for a larger utility deduction. In order to make
households eligible for the higher deduction, and thus for greater food
stamp benefits, states have distributed LIHEAP checks for amounts as small
as $1 to food stamp recipients.

The 2014 farm bill tightened this loophole by requiring that a household must
receive more than $20 annually in LIHEAP payments to be eligible for the larger
utility deduction and subsequently higher food stamp benefits.”” Nonetheless,
states continue to inflate their standard utility allowances. Under the Trump
Administration, the USDA proposed a rule, which was not finalized, that would
have standardized the utility allowance.”

Reform WIC. Turning to WIC, this program distributes money through EBT
cards to help low-income women, infants, and children under six purchase nutri-
tion-rich foods and nutrition education Gncluding breastfeeding support). As of
August 2022, approximately 6.3 million people participated in WIC each month
to purchase food.’* In 2021, WIC federal outlays were $5 billion.”

The next Administration should:

e Reform the state voucher system. State agencies control WIC costs
by approving only one brand of infant formula through competitive
bidding for infant formula rebate contracts. Because 50 percent of baby
formula is purchased through the federal WIC program, it is vital that
regulation for these competitive bidding contracts does not unintentionally
create monopolies.

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e Re-evaluate excessive regulation. As for baby formula regulations
generally, labeling regulations and regulations that unnecessarily delay the
manufacture and sale of baby formula should be re-evaluated.*° During the
Biden Administration, there have been devastating baby formula shortages.

Return to the Original Purpose of School Meals. Federal meal programs for
K-12 students were created to provide food to children from low-income families
while at school.*' Today, however, federal school meals increasingly resemble enti-
tlement programs that have strayed far from their original objective and represent
an example of the ever-expanding federal footprint in local school operations.

The NSLP and SBP are the two largest K-12 meal programs provided by federal
taxpayer money. The NSLP launched in 1946 and the SBP in 1966, both as options
specifically for children in poverty.®? During the COVID-19 pandemic, federal
policymakers temporarily expanded access to school meal programs, but some
lawmakers and federal officials have now proposed making this expansion per-
manent. Yet even before the pandemic, research found that federal officials had
already expanded these programs to serve children from upper-income homes,
and these programs are rife with improper payments and inefficiencies.

Heritage Foundation research from 2019 found that after the enactment of
the Community Eligibility Provision (CEP) in 2010, the share of students from
middle- and upper-income homes receiving free meals in states that participated in
CEP doubled, and in some cases tripled—all in a program meant for children from
families with incomes at or below 185 percent of the federal poverty line (Children
from homes at or below 130 percent of the federal poverty line are eligible for free
lunches, while students from families at or below 185 percent of poverty are eligible
for reduced-priced lunches).**

Under CEP, if 40 percent of students in a school or school district are eligible for
federal meals, all students in that school or district can receive free meals. However,
the USDA has taken it even further, improperly interpreting the law® to allow a
subset of schools within a district to be grouped together to reach the 40 percent
threshold, As a result, a school with zero low-income students could be grouped
together with schools with high levels of low-income students, and as a result all
the students in the schools within that group (even schools without a single low-in-
come student) can receive free federal meals.*° Schools can direct resources meant
for students in poverty to children from wealthier families.

Furthermore, the NSLP and SBP are among the most inaccurate federal
programs according to PaymentAccuracy.gov, a project of the U.S. Office of Man-
agement and Budget and the Office of the Inspector General.®*’ Before federal
auditors reduced the rigor of annual reporting requirements in 2018, the NSLP
had wasted nearly $2 billion in taxpayer resources through payments provided to
ineligible recipients.** Even after the auditing changes, which the U.S. Government

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Accountability Office said results in the USDA not “regularly assess[ing] the pro-
grams’ fraud risks,” the NSLP wasted nearly $500 million in FY 2021.° The SBP
now wastes nearly $200 million annually.”°

Despite the ongoing effort to expand school meals under CEP and the evidence
of waste and inefficiency, left-of-center Members of Congress and President Biden’s
Administration have nonetheless proposed further expansions to extend federal
school meals to include every K-12 student—regardless of need.?! The Administra-
tion recently proposed expanding federal school meal programs offered during the
school year to be offered during the summer as part of the “American Families Plan,”
and also proposed expanding CEP. Other federal officials, including Senator Bernie
Sanders (I-VT), have, in recent years, proposed expanding the NSLP to all students.”

To serve students in need and prevent the misuse of taxpayer money, the next
Administration should focus on students in need and reject efforts to transform
federal school meals into an entitlement program.

Specifically, the next Administration should:

e Promulgate a rule properly interpreting CEP. The USDA should issue
arule that clarifies that only an individual school or a school district as a
whole, not a subset of schools within a district, must meet the 40-percent
criteria to be eligible for CEP. Education officials should be prohibited from
grouping schools together.

e Work with lawmakers to eliminate CEP. The NSLP and SBP should be
directed to serve children in need, not become an entitlement for students
from middle- and upper-income homes. Congress should eliminate CEP.
Further, the USDA should not provide meals to students during the summer
unless students are taking summer-school classes. Currently, students can
get meals from schools even if they are not in summer school, which has, in
effect, turned school meals into a federal catering program.”

e Restore programs to their original intent and reject efforts to create
universal free school meals. The USDA should work with lawmakers
to restore NSLP and SBP to their original goal of providing food to K-12
students who otherwise would not have food to eat while at school.

Federal school meals should be focused on children in need, and any efforts
to expand student eligibility for federal school meals to include all K-12 students
should be soundly rejected. Such expansion would allow an inefficient, wasteful
program to grow, magnifying the amount of wasted taxpayer resources.

Reform Conservation Programs. Farmers, in general, are excellent stewards
of the land, if not for moral or ethical considerations, then out of self-interest to

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make sure their land and—by extension, their livelihoods—remain intact. Farmers
are often called the original conservationists.”*

When evaluating federal conservation programs, it is important to remember
the importance of the land to farmers. In terms of USDA federal conservation
programs, both the USDA’s Farm Service Agency (FSA) and Natural Resources
Conservation Service (NRCS) oversee numerous programs.”

As a general matter, the next Administration should ensure that these programs
address genuine and specific environmental concerns with a focus on currently
existing environmental problems, not those that are speculative in nature. These
conservation programs should have clearly identifiable goals, with the success or
failure of these programs being directly measurable. Any assistance to farmers to
take specific actions should not be provided unless the assistance will directly and
clearly help to address a specific environmental problem. Further, any assistance
to encourage farmers to engage in certain practices should only be provided if
farmers would not have adopted the practices in the first place.

There are specific issues that the next Administration should address. The
Conservation Reserve Program,” which is run by FSA, pays farmers to not farm
some of their land. This program has recently received attention, as agricultural
groups rightfully seek to farm without penalty voluntarily idled land, in light of
the consequences to food prices of Russia invading Ukraine.”

There is also a need to reform USDA's conservation easements. These easements
are a powerful tool to incentivize long-term preservation of ecosystems while still
allowing farmers to benefit economically. However, when farmers and ranchers
sign conservation easements with the USDA, they can be enforced in perpetuity.
Future generations, be they the descendants of the landowner or new residents,
are bound by those conditions.

Ecosystems and topography naturally change over time, but without legislative
change, easement requirements will not.

The next Administration should:

e Champion the elimination of the Conservation Reserve Program.
Farmers should not be paid in such a sweeping way not to farm their land. If
there is a desire to ensure that extremely sensitive land is not farmed, this
should be addressed through targeted efforts that are clearly connected to
addressing a specific and concrete environmental harm. The USDA should
work with Congress to eliminate this overbroad program.

e Reform NRCS wetlands and erodible land compliance and appeals.
Problematic NRCS overreach could be avoided entirely by removing its
authority to prescribe specific practices on a particular farm operation in
order to ensure continued eligibility to participate in USDA farm programs,

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and to require instead that each farm (as a function of eligibility) must have
created a general best practices plan. Such a plan could be approved by the
local county Soil and Water Conservation District (GWCD). The local SWCD
commissioners are elected by their peers in each respective county and are
better suited than the NRCS to provide guidance for farm operations in
their respective jurisdictions.

Ata minimum, a new Administration should support legislation to divest
more power to the states (and possibly local SWCDs) regarding erodible
land and wetlands conservation.”

e Reform easements. The new Administration should, to the extent
authorized by law, limit the use of permanent easements and
collaborate with lawmakers to prohibit the USDA from creating new

permanent easements.”

Other Major Issues and Specific Recommendations. Although the following
issues have not been listed as “priority,” these issues are still extremely important,
and the next Administration should address them.

Only meat and poultry from federally inspected facilities can be sold in inter-
state commerce.’” Even meat and poultry from USDA-approved state-inspected
facilities may only be sold in intrastate commerce, with limited exceptions.!"
This is despite the fact that states with USDA-approved inspection programs
must meet and enforce requirements that are “at least equal to” those imposed
under the Federal Meat and Poultry Products Inspection Acts and the Humane
Methods of Slaughter Act of 1978.‘ This is an unnecessary regulatory barrier
that makes it difficult to get meat and poultry into interstate commerce to create
more options for consumers and farmers. Legislation entitled the New Mar-
kets for State-Inspected Meat and Poultry Act of 2021 would help to remove
this obstacle.’

The next Administration should:

e Promote legislation that would allow state-inspected meat to be sold
in interstate commerce. These barriers to the sale of meat and poultry
from USDA-approved state-inspected facilities should be removed.

Eliminate or Reform Marketing Orders and Checkoff Programs. Mar-
keting orders and checkoff programs for agricultural commodities are similar in
many ways. They both allow private actors within an industry to collaborate with
the federal government to compel other competitors within an industry to fund the
respective marketing order or checkoff program. There are currently 22 checkoff

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programs,!” and they focus on research and promotion of commodities such as beef
and eggs. Marketing orders cover research and promotion, but also cover issues
such as quality regulations and volume controls. The latter issue, volume controls,
is ameans to restrict supply, which drives up prices for consumers. Fortunately,
there are few active volume controls.’

Marketing orders and checkoff programs are some of the most egregious pro-
grams run by the USDA. They are, in effect, a tax—a means to compel speech—and
government-blessed cartels. Instead of getting private cooperation, they are tools
for industry actors to work with government to force cooperation.

The next Administration should:

e Reduce the number and scope of marketing orders and checkoff
programs. The USDA should reject any new requests for marketing orders
and checkoff programs to the extent authorized by law and eliminate
existing programs when possible. While the programs work differently,
there are often petition processes and other ways that make it difficult for
affected parties to get rid of the marketing orders and checkoff programs,'”°
and the USDA itself may not even be required to honor requests to
terminate a program.” The USDA should make the process easier. Further,
the USDA should reject any effort to bring back volume controls to limit
supplies of commodities.

e Work with Congress to eliminate marketing orders and checkoff
programs. These programs should be eliminated, and if industry actors
want to collaborate, they should do so through private means, not using the
government to compel cooperation.

e Promote legislation that would require regular votes. There should
be regular voting for parties subject to checkoff programs and marketing
orders. For example, the voting should occur at least every five years, to
determine whether a marketing order or checkoff program should continue.
The USDA should be required to honor the results of such a vote. Through
regular voting, parties can demonstrate their support for a marketing order
or checkoff program and ensure that those administering them will be held
accountable.

Focus on Trade Policy, Not Trade Promotion. The USDA’s Foreign Agri-
cultural Service (FAS) covers numerous issues, including “trade policy,” which
is areference to removing trade barriers, among other things, to ensure an envi-
ronment conducive to trade. It also covers trade promotion.’ This includes
programs like the Market Access Program" that subsidizes trade associations,

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businesses, and other private entities to market and promote their products

overseas. FAS should play a proactive and leading role to help open upmarkets

for American farmers and ranchers. There are numerous barriers, such as sani-
tary and phytosanitary measures, blocking American agricultural products from

gaining access to foreign markets." However, FAS should not help businesses and

industries promote their exports, something these businesses and industries can

and should do on their own.

The next Administration should:

e Push legislation to repeal export promotion programs. The USDA
should work with Congress to repeal market development programs like the
Market Access Program and similar programs.

Remove Obstacles for Agricultural Biotechnology. Innovation is critical to
agricultural production and the ability to meet future food needs. The next Admin-
istration should embrace innovation and technology, not hinder its use—especially
because of scare tactics that ignore sound science. One of the key innovations in
agriculture is genetic engineering. According to the USDA, “[C]urrently, over 90
percent of U.S. corn, upland cotton, and soybeans are produced using GE [genet-
ically engineered] varieties.”"”

Despite the importance of agricultural biotechnology, in 2016, Congress passed
a federal mandate to label genetically engineered food."* This legislation was argu-
ably just a means to try to provide a negative connotation to GE food. There are
other challenges as well for agricultural biotechnology. For example, Mexico plans
to ban the importation of U.S. genetically modified yellow corn."

The next Administration should:

e Counter scare tactics and remove obstacles. The USDA should strongly
counter scare tactics regarding agricultural biotechnology and adopt
policies to remove unnecessary barriers to approvals and the adoption of
biotechnology.

e Repeal the federal labeling mandate. The USDA should work with
Congress to repeal the federal labeling law, while maintaining federal
preemption, and stress that voluntary labeling is allowed.

e Use all tools available to remove improper trade barriers against
agricultural biotechnology. The USDA should work closely with the Office
of the United States Trade Representative to remove improper barriers
imposed by other countries to block US. agricultural goods.

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Reform Forest Service Wildfire Management. The United States Forest
Service is one of four federal government land management agencies that admin-
ister 606 million acres, or 95 percent of the 640 million acres of surface land area
managed by the federal government." Located within the USDA, the Forest Service
manages the National Forest System, which is comprised of 193 million acres."°
As explained by the USDA, “The USDA Forest Service’s mission is to sustain the
health, diversity, and productivity of the nation’s forests and grasslands to meet
the needs of present and future generations.”!””

The Forest Service should focus on proactive management of the forests and
grasslands that does not depend heavily on burning. There should be resilient
forests and grasslands in the wake of management actions. Wildfires have become
a primary vegetation management regime for national forests and grasslands."*

Recognizing the need for vegetation management, the Forest Service has adopted
“pyro-silviculture” using “unplanned” fire,"’ such as unplanned human-caused fires,
to otherwise accomplish vegetation management.’”°

The Forest Service should instead be focusing on addressing the precipitous
annual amassing of biomass in the national forests that drive the behavior of
wildfires. By thinning trees, removing live fuels and deadwood, and taking other
preventive steps, the Forest Service can help to minimize the consequences
of wildfires.

Increasing timber sales could also play an important role in the effort to change
the behavior of wildfire because there would be less biomass. Timber sales and
timber harvested in public forests dropped precipitously in the early 1990s and
still remain very low. For example, in 1988, the volume of timber sold and harvested
by volume was about 11 billion and 12.6 billion board feet (BBF), respectively.'” In
2021, timber sold was 2.8 BBF and timber harvested was 2.4 BBF.

In 2018, President Donald Trump issued Executive Order 13855 to, among
other things, promote active management of forests and reduce wildfire risks.!”"
The executive order stated, “Active management of vegetation is needed to treat
these dangerous conditions on Federal lands but is often delayed due to challenges
associated with regulatory analysis and current consultation requirements.” It
further explained the need to reduce regulatory obstacles to fuel reduction in
forests created by the National Environmental Policy Act and the Endangered
Species Act.!”4

The next Administration should:

e Champion executive action, consistent with law, and proactive
legislation to reduce wildfires. This would involve embracing Executive
Order 13855, building upon it, and working with lawmakers to promote
active management of vegetation, reduce regulatory obstacles to reducing
fuel buildup, and increase timber sales.

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Eliminate or Reform the Dietary Guidelines. The USDA, in collaboration
with HHS, publishes the Dietary Guidelines every five years.’ For more than 40
years, the federal government has been releasing Dietary Guidelines,”° and during
this time, there has been constant controversy due to questionable recommenda-
tions and claims regarding the politicization of the process.

In the 2015 Dietary Guidelines process, the influential Dietary Guidelines Advi-
sory Committee veered off mission and attempted to persuade the USDA and HHS
to adopt nutritional advice that focused not just on human health, but the health
of the planet.’”’ Issues such as climate change and sustainability infiltrated the
process. Fortunately, the 2020 process did not get diverted in this manner. How-
ever, the Dietary Guidelines remain a potential tool to influence dietary choices to
achieve objectives unrelated to the nutritional and dietary well-being of Americans.

There is no shortage of private sector dietary advice for the public, and nutrition
and dietary choices are best left to individuals to address their personal needs. This
includes working with their own health professionals. As it is, there is constantly
changing advice provided by the government, with insufficient qualifications on
the advice, oversimplification to the point of miscommunicating important points,
questionable use of science, and potential political influence.

The Dietary Guidelines have a major impact because they not only can influence
how private health providers offer nutritional advice, but they also inform federal
programs. School meals are required to be consistent with the guidelines.’”*

The next Administration should:

e Work with lawmakers to repeal the Dietary Guidelines. The USDA
should help lead an effort to repeal the Dietary Guidelines.

e Minimally, the next Administration should reform the Dietary
Guidelines. The USDA, with HHS, should develop a more transparent
process that properly considers the underlying science and does not
overstate its findings. It should also ensure that the Dietary Guidelines
focus on nutritional issues and do not veer off-mission by focusing on
unrelated issues, such as the environment, that have nothing to do with
nutritional advice. In fact, if environmental concerns supersede or water
down recommendations for human nutritional advice, the public would
be receiving misleading health information. The USDA, working with
lawmakers, should codify these reforms into law.

ORGANIZATIONAL ISSUES

Based on the recommended reforms identified as ideal solutions, the USDA
would look different in many respects. One of the biggest changes would be aUSDA
that is not focused on welfare, given that means-tested welfare programs would

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be moved to HHS. The Food and Nutrition Service that administers the food and
nutrition programs would be eliminated.

The Farm Service Agency, which administers many of the farm subsidy pro-
grams, would be significantly smaller in size if the ideal farm subsidy reforms
were adopted.

Most important, a conservative USDA, as envisioned, would not be used as a
governmental tool to transform the nation’s food system, but instead would respect
the importance of efficient agricultural production and ensure that the government
does not hinder farmers and ranchers from producing an abundant supply of safe
and affordable food.

For a conservative USDA to become a reality, and for it to stay on course with
the mission as outlined, the White House must strongly support these reforms and
install strong USDA leaders. These individuals almost certainly will be faced with
opposition from some in the agricultural community who would fight changing
subsidies in any fashion, although many of the reforms would likely be embraced
by those in agriculture.

There would be strong opposition from environmental groups and others who
want the federal government to transform American agriculture to meet their ideo-
logical objectives. Finally, there would be opposition from left-of-center groups
who do not want to reform SNAP and would expand welfare and dependency—such
as through universal free school meals—as opposed to reducing dependency.

Reducing the scope of government and promoting individual freedom may not
always be easy, but it is something that conservatives regularly should strive for.
The listed reforms to the U.S. Department of Agriculture would help to accom-
plish these objectives and are well worth fighting for to achieve a freer and more
prosperous nation.

CONCLUSION

This chapter started with a discussion of the incredible success of American
farmers and American agriculture in general. This is how the chapter should close
as well. Americans are blessed with an agricultural sector, and a food system in
general, which are worthy of incredible respect. A conservative USDA should
appreciate this while recognizing that its role is to serve the interests of all Amer-
icans, not special interests. By being a champion of unleashing the potential of
American agriculture, a conservative USDA would help to ensure a future with
an abundant supply of safe and affordable food for individuals and families in the
United States and across the globe.

AUTHOR’S NOTE: The author would like to thank all the contributors for their assistance, expertise, and insight
into the development of this chapter. In addition, special thanks are due to Rachael Wilfong, who was instrumental
in getting the chapter ready for submission.

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U.S. Department of Agriculture, Fiscal Year 2023 Budget Summary, 1, https://www.usda.gov/sites/default/
iles/documents/2023-usda-budget-summary.pdf (accessed December 14, 2022).
See, for example, U.S. Department of Agriculture, “Transforming the U.S. Food System,” https://www.usda.

U.S. Department of Agriculture, Fiscal Year 2023 Budget Summary, p11.
U.S. Department of Agriculture, “USDA Celebrates 150 Years,” https://www.usda.gov/our-agency/about-usda/

The law stated, “[T]here is hereby established at the seat of government of the United States a Department

of Agriculture, the general designs and duties of which shall be to acquire and to diffuse among the people

information on subjects connected with agriculture in the most general and

comprehensive sense of that word, and to procure, propagate, and distribute among the people new and

Gladys L. Baker et al.

, Century of Service: The First 100 Years of the United States

Department of Agriculture, (Washington, DC: U.S. Government Printing Office, 1963) p. 13, https://babel.

U.S. Department of Agriculture, “UN Food Systen

ore Competitive, Mo

(accessed December

National Food Policy

hathitrust.org/cgi/pt?id=ucl.04254098&view=lup&seq=33 (accessed December 16, 2022).
U.S. Department of Agriculture, Fiscal Year 2023 Budget Summary, p. 2.

U.S. Department of Agriculture, Strategic Plan: Fiscal Years 2022-2026, p. 3, https://www.usda.gov/sites/
default/files/documents/usda-fy-2022-2026-strategic-plan.pdf (accessed December 14, 2022).
ews release, “USDA Announces Framework for

Shoring Up the Food Supply Chain and Transforming the
e Resilient,” U.S. Department of Agriculture, June 1, 2022,

https://www.usda.gov/media/press-releases/2022/06/01/usda-announces-framework-shoring-food-supply-
chain-and-transforming (accessed December 14,
U.S. Department of Agriculture, “Transforming th
U.S. Department of Agriculture, Strategic Plan: Fiscal Years 2022-2026, pp. 1-2.
U.S. Department of Agriculture, “Background on
August 4, 2021, https://Awww.usda.gov/sites/defa

2022).
e U.S. Food System.”

the U.S. Approach to the 2021 UN Food Systems Summit,”

ult/files/documents/Background-on-US-approach-2021-UN-
14, 2022).
ns Summit,” https://www.usda.gov/oce/sustainability/un-

Could Save Millions of American Lives,” The Washington

remism/ (accessed D:

os://www.washingtonpost.com/opinions/how-a-national-food-policy-could-
ives/2014/11/07/89c55e16-637f-lle4-836c-83bc4f26eb67_story.html (accessed
Bakst and Gabriella Beaumont-Smith, “No, We Don’t Need to Transform the
American Food System,” The Daily Signal, February 26, 2021, https://www.dailysignal.com/2021/02/26/
orm-the-american-food-system/ (accessed December 14, 2022); and Daren
Bakst, “Biden’s Food Conference Should Put Peo
.com/2022/09/22/bidens-food-conference-should-put-people-

ple First, Not Environmental Extremism,” The Daily Signal,

ecember 14, 2022).

est Up to $300 Million in New Organic Transition Initiative,” U.S. Department of
2, https://www.usda.gov/media/press-releases/2022/08/22/usda-invest-300-
ion-initiative (accessed December 14, 2022).

en New Deal Was a Disaster,” Farm Futures, November 14, 2022, https://www.

ENDNOTES
1.
2.
gov/fst (accessed December 14, 2022).
S
4,
history (accessed December 16, 2022).
5.
of the United States useful
valuable seeds and plants.”
6.
7. — |bid., p. 2.
8.
9.
Food System to Be Fairer,
10.
11.
12.
ood-Systems-Summit.od
13.
summit (accessed December 14, 2022).
14. Mark Bittman et al., “How a
Post, November 7, 2014, ht
save-millions-of-american-
December 14, 2022); Daren
no-we-dont-need-to-trans
September 22, 2022, https://www.dailysigna
irst-not-environmental-ex
15. News release, “USDA to Inv
Agriculture, August 22, 202
million-new-organic-transi
16. Gary Baise, “Sri Lanka’s Gre
armprogress.com/commentary/sri
17.

or Organic Foods,” Econom

ers.usda.gov/amber-waves/2017/jan

usda.gov/amber-waves/2016/may/i
6, 2022). Further, there are many myths, such as t

-lankas-green-new-deal-was-disaster (accessed December 16, 2022).

See, for example, Catherine Greene et al., “Growing Organic Demand Provides High-Value Opportunities for Many
Types of Producers,” Economic Research Service, U.S. Department of Agriculture, February 6, 2017, httos://www.
uaryfebruary/growing-organic-demmand-provides-high-value-opportunities-
or-many-types-of-producers/#:~:text=ERS%20research%20shows%20that%20many,flavor%20desired%20
by%20the%20consumer (accessed December 14, 2022), and Andrea Carlson, “Investigating Retail Price Premiums

ic Research Service, U.S. Department of Agriculture, May 24, 2016, https://www.ers.

nvestigating-retail-price-premiums-for-organic-foods/ (accessed December

hose regarding the alleged health benefit of organic food. One

— 311—

18.

19.

20.
21.

22.

23.

24.

25:
26.
27.
28.

29.
30.

31.

32.

33.

Mandate for Leadership: The Conservative Promise

me
nutritious

Genetic Li

See, for examp
Partnershi
gov/document/US
nflation Reduction
U.S. Department o
(1948-2019),” h
growth-in-u-s-agri
U.S. Department o
Percent of Disposa
chart-gallery/galle

p Program, Req
DA-202
Act of 2022, Public Law 117-
, Economic Research Service, “Productivity Growth in U.S. Agriculture
tos://www.ers.usda.gov/data-products/agricultural-productivity-in-the-u-s/productivity-
1948-2019/ (accessed December 14, 2022).

ture, Economic Research Service, “Total Food Budget Share Increased from 9.4
0 10.3 Percent

culture-

ble Income

U.S. Department o

Table 1101, h
income-quin

0.176, Apri

Slush

iles-befo

a study found that “[t]he published literatu
han conventional foods.” Crystal Smith-Spang
Conventional Alternatives,” Annals of Internal Medicine, Vol.
www.acpjournals.org/doi/epdf/10.7326/0003-48
Steve Savage, “USDA Data Con i

irm Org

eracy Project, February 16, 2018, https://genetic
organic-yields-dramatically-lower-conventional-farming/ (accessed December 16, 2022).
e, U.S. Department of Agricultu
or Comments,”

est

-0010-0001

Agriculture

Agricu

y/chart-detail/2char
Labor,

Foundation /ssue

Bureau of Labor Sta
eans, Shares, and Standard Errors, and Coef

e lacks strong evidence that organic foods are significantly more
er et al. “Are Organic Foods Safer or Healthier Than

57, No. 5 (September 4, 2012), pp. 348-366, https://
9-157-5-201209040-00007 (accessed December 16, 2022).
ds Significantly Lower Than With Conventional Farming,”
iteracyproject.org/2018/02/16/usda-data-confirm-

anic Yie

e, “Notice: Climate-Smart Agriculture and Forestry
USDA-2021-0010, October 21, 2021, https://www.regulati
accessed December 16, 2022).

69.

ons.

in 2021,” July 15, 2022, https://www.ers.usda.gov/data-products/
|d=76967 (accessed December 14, 2022).

istics, “Quintiles of Income Before Taxes: Annual Expenditure
icients of Variation, Consumer Expenditure Surveys,” 2021,

os://www.bls.gov/cex/tables/calendar-year/mean-item-share-average-standard-error/cu-

e-taxes-20721.pdf (accessed December 16, 2022), and Daren Bakst and Patrick Tyrrell,
“Big Government Policies That Hurt the Poor and How to Address Them,” Heri
5, 2017, p.
Daren Bakst and Joshua Sewel
Fund,” Heritage

age Foundation Special Report

7, https://www.heritage.org/sites/default/files/2017-04/SRI76.pdf.
, ‘Congress Should S

op Abrogating Its Spending Power and Rein in the USDA
0. 6052, February 19, 2021, p. 2, httos://www.heritage.org/

Brief

budget-and-spending/report/congress-should-stop-abrogating-its-spending-power-and-rein-the-usda.

Commodity Credit Corporation
and Sewall, “Congress Should S

Baks
bid., p. 3.

Daren Bakst, “Com
Program, Request
regu
U.S. Department o
egan Stubbs, “Th
Congress, updated

“Overall, 34 percen

ment
ations.gov/document/USDA-202
e Commodi
December 16, 2022).

t of al
4 percent of U.S. farms partici

Ryan Olver, “Ameri

Agriculture, “Notice
ty Credit
2021, h

January 14,

ce, pp. 24 and
arch 18, 2023).

Congressional Research Service Report

(accessed
Although li
Federation

vestock

he ask[ed

December

President
farmers couldn't survi

4, 2022).
and special

y crop p
Bob Stallman cap

Charter Act of

rom Bakst, Darren” on “No
for Comments,” USDA-2021-0010, October 21, 2021,” November 1, 2021, https://www.
1-

tps://crsrepor

farms reported receiving some type of Government payment in
pated in Federal crop insurance programs.” Christine Whitt, Noah Miller, and
ca’s Farms and Ranc
Economic Research Servi
pdf?v=527.4 (accessed
payments beyond jus
Randy Schnepf, “Farm Safety-

commodity payn
et Paymen

ve without subsidy money. ‘Why does
. ‘Why does the specialty crop [
Taxpayers Subsidize Rich Farmers?” The Washington Post,

948, Public Law 80-806.

op Abrogating Its Spending Power.”

ice: Climate-Smart Agriculture and Forestry Partnership

0010-0001/comment?filter=bakst (accessed December 16, 2022).

: Climate-Smart Agriculture and Forestry Partnership Program.”

Corporation (CCC),’ Congressional Research Service Report for
s.congress.gov/product/pdf/R/R44606 (accessed

2021,” and “[o]verall,

hes at a Glance: 2022 Edition,” U.S. Department of Agriculture,
26, https://www.ers.usda.gov/webdocs/publications/105388/eib-247,
This data, which apparently does not cover crop insurance, included
nents, such as conservation payments.
s Under the 2014 Farm Bill: Comparison by Program Crop,”
Congress, August 11, 2017, https://fas.org/sgp/crs/misc/R44914.pdf

for

oducers do receive some subsidies, former American Farm Bureau
ured the subsidy issue well. He “dismisse[d] outright the claim that
the livestock industry survive without subsidies?’
e] industry survive?” Tamar Haspel, “Why Do
arch 15, 2018, https://www.washingtonpost.

ruit and vegetab

com/lifestyle/food/why-do-taxpayers-subsidize-rich-farmers/2018/03/15/50e89906-27b6-lle8-b79d-

f3d93idb7

68_story.html (accessed March 18, 2023).

— 312 —

34,

35.

56.

37.

38.

39.
40.

Al.

42.
43.

44.

AS.

46.

47.
48.

49.
50.

ol.
52.

53:

54.

U.S. Department of A

bid.
U.S. Department of A
httos://www.ers.usda
(accessed December
U.S. Department of A

FactSheets/2019/arc-
See, for example, U.S
Loss Coverage Handb
arcplc_rOl_a
Coverage and Agricul

of Agriculture, Economic Research Service, August 6, 2018, https://www.ers.usda.gov/amber-waves/20
august/federal-commodi

and-yield-risks-faced
Loss Agriculture Prog
(accessed March 18, 2
bid.

February 18, 2021, p.

Congressional Budge
December 2022, p. 6,
(accessed December
Rosch, “Federal Crop

programs-and-services/arcplc_prog

Stephanie Rosch, “Federa

2025 Presidential Transition Project

griculture, Farm Service Agency, “ARC/PLC Program,” https://www.fsa.usda.gov/
am/index (accessed December 16, 2022).

griculture, Economic Research Service, “Crop Insurance at a Glance,” May 31, 2022,

.gov/topics/farm-practices-management/risk-management/crop-insurance-at-a-glance/
16, 2022).
griculture, “Agriculture Risk Coverage (ALC) & Price Loss Coverage (PLC),” Farm

Service Agency Fact Sheet, August 2019, https://www.fsa.usda.gov/Assets/USDA-FSA-Public/usdafiles/

plc_overview_fact_sheet-aug_2019.pdf (accessed December 16, 2022).
Department of Agriculture, Farm Service Agency, Agriculture Risk Coverage and Price
ook, last amended October 5, 2020, https://www.fsa.usda.gov/Internet/FSA_File/

O.pdf (accessed March 18, 2023); Mesbah Motamed, “Federal Commodity Programs Price Loss

ture Risk Coverage Address Price Yield Risks Faced by Producers,” U.S. Department
8/
y-programs-price-loss-coverage-and-agriculture-risk-coverage-address-price-
-by-producers/ (accessed March 18, 2023); and Taxpayers for Common Sense, “Shallow
rams 101,” https://www.taxpayer.net/agriculture/shallow-loss-agriculture-programs-101/
023).

Crop Insurance: A Primer,’ Congressional Research Service Report for Congress,

, https://crsreports.congress.gov/product/pdf/R/R46686 (December 14, 2021).

Office, Options for Reducing the Deficit, 2023 to 2032: Volume Il; Smaller Reductions,
httos://www.cbo.gov/system/files/2022-12/58163-budget-options-small-effects.odf
14, 2022).

nsurance: A Primer,” p. 17.

“Farm Bill Primer: Sugar Program,” Congressional Research Service /n Focus, updated May 15, 2018, https://

www.everycrsreport.com/files/2018-05-15_IF

(accessed December
See, for example, Agr:
mplications for the 2

U.S. Departmen
That Hurt the Poor an
Congressional Budge
Budget Office,
or Reducing
(accessed
Congressional Budge
“Reduce Premium Su
httos://www.heritage
Congressional Budge
bid.
Congressional Budge
U.S. Departmen
(C
Agriculture, “About C
December 16, 2022).
Dietary Guidelines fo
about-dietary-guideli
Robert Rector and Vij
t,” Heritage Foundati

he Defi

“Reduce Subsidies in the Crop Insu

December 14, 2022)

0689_42900e56he67f5cfal7e40953ad9acb5456ld3db.pdf

6, 2022).
alytica, “Economic Effects of the Sugar Program Since the 2008 Farm Bill & Policy
013 Farm Bill,” June 3, 2013, p. 1, https://fairsugarpolicy.org/wordpress/wp-content/

uploads/2018/03/AgralyticaEconomicEffectsPaperJune2013.pdf (accessed December 16, 2022).
of Labor, “Quintiles of Income Be

ore Taxes,” and Bakst and Tyrrell, “Big Government Policies

d How
Office,

o Address Them.”
Options for Reducing the Deficit, 2023 to 2032, p. 3. See also Congressional
ance Program,” in Congressional Budget Office, “Options
to 2030,” December 9, 2020, https://www.cbo.gov/budget-options/56815

cit: 202

Office, Options for Reducing the Deficit, 2023 to 2032, p. 6.

bsidies in the Federal Crop Insurance Program,” Budget Blueprint for Fiscal Year 2023,
.org/budget/pages/recommendations/2.350.171.html.

Office, “Reduce Subsidies in the Crop Insurance Program.”

Office, Options for Reducing the Deficit, 2023 to 2032, p. 6.

of Agriculture, Food and Nutrition Service, “Center for Nutrition Policy and Promotion
PP),” https://www.fn

.usda.gov/cnpp (accessed December 16, 2022), and U.S. Department of
PP” Food and Nutrition Service, https://www.fns.usda.gov/about-cnpp (accessed

Americans, “Purpose of the Dietary Guidelines,” https://www.dietaryguidelines.gov/
nes/purpose-dietary-quidelines (accessed December 16, 2022).

ay Menon, “Understanding the Hidden $111 Trillion Welfare System and How to Reform
on Backgrounder No. 3294, April 5, 2018, https://www.heritage.org/welfare/report/

understanding-the-hi

dden-l1-trillion-welfare-system-and-how-reform-it.

— 313 —

Dos
56.
57.

58.
59.
60.
61.
62.
63.
64.

65.

66.

67.

68.

69.

70.

71.

72.

73.

74,

75,

76.

77,

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U.S. Department of Agriculture, “SNAP Data Tables,” Food and Nutrition Service, December 9, 2022, https://
www.fns.usda.gov/pd/supplemental-nutrition-assistance-program-snap (accessed December 16, 2022).
bid.
U.S. Department of Agriculture, Food and Nutrition Service, “SNAP Work Requirements,” May 2019, https://
www.fns.usda.gov/snap/work-requirements#:~:text=Work%20at%20least%2080%20hours, least%2080%20
hours%20a%20month (accessed December 16, 2022).

U.S. Code § 2015, https://www.law.cornell.edu/uscode/text/7/2015 (accessed December 16, 2022).

bid.
U.S. Code § 2015(0)(4). The USDA has approved nearly all waivers under the “lack of sufficient jobs” option.
Federal Register, Vol. 84, No. 234 (December 5, 2019) p. 66782, https:/Awww.govinfo.gov/content/pkg/FR-
2019-12-05/pdf/2019-26044.pdf (accessed December 14, 2022).

bid., p. 66795,

bid., pp. 66807-66810.

District of Columbia, et al. v. U.S. Department of Agriculture, 496 F. Supp. 3d 213 (2020), https://oag.dc.gov/
sites/default/files/2020-10/SNAP-ABAWD-Opinion.pdf (accessed December 16, 2022).

bid. On December 16, 2020, the Trump Administration appealed the District Court decision. See, for example,
ews release “Fudge Slams Administration for Appealing ABAWD Ruling,” House Committee on Agriculture,
December 16, 2020, https://agriculture.house.gov/news/documentsingle.aspx?DocumentID=2069 (accessed
December 16, 2022).
ews release, “Statement by Agriculture Secretary Tom Vilsack on D.C. Circuit Court’s Decision

Regarding ABAWDs Rule,” U.S. Department of Agriculture, March 24, 2021, https://www.usda.gov/media/
press-releases/2021/03/24/statement-agriculture-secretary-tom-vilsack-dc-circuit-courts (accessed
December 16, 2022).
U.S. Department of Agriculture, “SNAP Employment and Training Screening and Referral Guidance,” July 13,
2022, https://www.fns.usda.gov/snap/et-screening-and-referral-guidance (accessed December 16, 2022).
U.S. Department of Agriculture, Food and Nutrition Service, “Regulatory Reform at a Glance: Proposed Rule;
Revision of SNAP Categorical Eligibility,” July 2019, https://www.usda.gov/sites/default/files/documents/
BBCE_Fact_Sheet_%28FINAL%29_72219-PR.pdf (accessed December 14, 2022).

7 Code of Federal Regulations § 273.8 (1978), https://www.law.cornell.edu/cfr/text/7/273.8 (accessed
December 16, 2022).
Kristina Rasmussen, “How Millionaires Collect Food Stamps,” Wall Street Journal, January 15, 2018, https://
www.wsj.com/articles/how-millionaires-collect-food-stamps-1516044026 (accessed December 14, 2022).
Federal Register, Vol. 84, No. 142 July 24, 2019), pp. 35570-55581, https://www.federalregister.gov/
documents/2019/07/24/2019-15670/revision-of-categorical-eligibility-in-the-supplemental-nutrition-
assistance-program-snap (accessed December 14, 2022).
ews release, “USDA Modernizes the Thrifty Food Plan, Updates SNAP Benefits,” U.S. Department o
Agriculture, August 16, 2021, https://www.usda.gov/media/press-releases/2021/08/16/usda-modernizes-
hrifty-food-plan-updates-snap- (accessed December 14, 2022).

Phillip L. Swagel, Director, Congressional Budget Office, letter to Congressman Jason Smith, June 23, 2022, p.
2, https://www.cbo.gov/system/files/2022-06/58231-Smith.odf (accessed December 14, 2022).

Congressional Budget Office, “H.R. 2, as Passed by the House of Representatives and as Passed by the Senate,”
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ews release, “Republican AG Committee Leadership Urge GAO Review of USDA Thrifty Food Plan Scheme,”
U.S. House Committee on Agriculture, August 13, 2021, https://republicans-agriculture.house.gov/news/
documentsingle.aspx?DocumentID=7013 (accessed December 14, 2022).

“The 2014 Farm Bill: Changing the Tradition of LIHEAP Receipt in the Calculation of SNAP Benefits,” updated
February 12, 2014, Congressional Research Service Report for Congress R42591, https://crsreports.congress.
gov/product/pdf/R/R42591/24 (accessed March 18, 2023).

Federal Register, Vol. 84, No. 192 (October 3, 2019), pp. 52809-52815, https://www.govinfo.gov/content/pkg/
FR-2019-10-03/pdf/2019-21287.pdf (accessed December 16, 2022).

U.S. Department of Agriculture, “Special Supplemental Nutrition Program for Women, Infants, and Children
(WIC) Data Series, 2018 to 2022,” https://www.fns.usda.gov/pd/wic-program (accessed December 14, 2022).

—~s

—S

—314-

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82.

83.

84.

85.

86.

87.

88.

89.

90.
91.

92.

93.

94.

95.

96.

nfant Form

December 14, 2022).

U.S. Depar

ulture,
al FitzSimons, “
a

yjpamgt/v

2025 Presidential Transition Project

U.S. Department of Agriculture,

www.fns.usda.gov/pd/wic-program (accessed

U.S. Food and Drug Administrati

ula,” May 16, 2022, h

information/regulations-and-in
]

nent of Agriculture,

3a41_3a

on, “Regula
tos://www.
ormation-manu

IIs
Management, Vo
y_3a2022 3ai_3a

n Food and Nutrition Service, “History of the
January 17, 2008, https://www.fns.usda.gov/nslp/program-history (accessed
ment of Agriculture,

of the

he Key
41, No.1
Sap_3a358-364.htm (accessed December 14, 2022).

Food and Nutrition Service, “WIC Data Tables,” December 9, 2022, https://
December 16, 2022).

ions and Information on the Manufacture and Distribution of
da.gov/food/infant-formula-gu
acture-and-distribution-in

idance-documents-regulatory-
ant-formula (accessed

ational School Lunch Program,”
December 14, 2022).

Food and Nutrition Service, “School Breakfast Program History,” July 24,
2013, https:/www.fns.usda.gov/sbp/program-history (accessed December
Food and Nutrition Service, “History
Free School Meals for A
| of Policy Analysis and

42022), and U.S. Department of
ational School Lunch Program.”

o Supporting Education and Health Outcomes,”
(2022), pp. 358-364, https://econpapers.repec.org/

Jonathan Butcher an
e

default/fil

Daren Bakst and Jon
Foundation

bid., and U.S. Depar
9, 2019, ht

See Payment Accura
Payment Accuracy, “
FNS%20

Reduce Imp
ht

oper Pa

Whi
brie
December 14,

e House,
2022).

bill/
See,

and

December 16, 2022).

30, 2017, h
December 16, 2022).
U.S. Depar

U.S. Depar

ps://www.gao.gov/produc
Payment Accuracy, “Paymen
“Fact Shee
ing-room/statemen

Universal School Meals P
17th-congress/senate-bi
for example, U.S. De
utrition Service, Septen

d Vijay

d,” Heritage Foundation Backgrounder
es/2019-03/BG3399.pdf.

athan B'

Issue Brief No. 4976, July 11, 2019, h
critical-fix-the-federal-overreach-school-meals.
Agriculture, Food
ps://www.fns.usda.gov/cn/commun

ment 0

Paymen

FY%202022%20Q3.pdf (acces
U.S. Government Accountabili
B

yments

SaIe

ment of Agriculture, Farm
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Agriculture, Natural Resources Conse
programs-initiatives (accessed December 16, 2022).
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enon, “Returning

tcher, “A Critical Fi

and

ntegrity Scorecard.”

: The American Families P

o the In
0. 3399,

x to the
tps://www.heritage.org/hunger-and-food-programs/report/
ity-e

ntegrity Scorecard,” h

ent of Government School Meals: Helping Students
arch 22, 2019, https://www.heritage.org/sites/

Federal Overreach on Schoo! Meals,” Heritage

utrition Service, “Community Eligibility Provision,” April
igibility-provision (accessed December 16, 2022).
cy, https://(www.paymentaccuracy.gov/ (accessed December 16, 2022).
ttos://www.cfo.gov/wp-content/uploads/2022/Q3/
ational%20School%20Lunch%20Program%20(NSLP)%20Payments%20Integrity%20Scorecard%20
sed December 14, 2022).
y Office, “School Mea
ut Should Comprehen
s/gao-19-389 (accesse

Programs: USDA Has Reported Taking Some Steps to

sively Assess Fraud Risks,’ GAO-19-389, May 21, 2022,

December 14, 2022).

.” April 28, 2021, httos://www.whitehouse.gov/

eases/2021/04/28/fact-sheet-the-american-families-plan/ (accessed

ogram Act of 2021, S. 1530, 1
1/1530 (accessed December 14, 2022).

partment of Agriculture, “Find Meals for Kids When Schools Are Closed,” Food and
nber 22, 2022, https://www.fn
U.S. Department of Agriculture, Food and Nutritio
School,” July 16, 2013, httos://www.fns.usda.gov/sfsp/s

[om Driscoll, “From the Field: Farmers Are the Origina
tps://nfu.org/2017/08/30/

7th Cong,, Ist Sess., https://www.congress.gov/

s.usda.gov/meals4kids (accessed December 16, 2022),
n Service, “Seamless Summer and Other Options for
eamless-summer-and-other-options-schools (accessed

Conservationists,” National Farmers Union, August

rom-the-field-farmers-are-the-original-conservationists/ (accessed

Service Agency, “Conservation Programs,” https://www.fsa.usda.gov/
-programs/index (accessed
rvation Service, “Programs and Initiatives,” h

December 16, 2022), and U.S. Department of
tos://www.nrcs.usda.gov/

Service Agency, “Conservation Reserve Program: About the

Conservation Reserve Program (CRP),” https://www.fsa.usda.gov/programs-and-services/conservation-
programs/conservation-reserve-program/ (accessed December 16, 2022).

— 315 —

97.

98.

99.

100.

101.

102.
103.

Mandate for Leadership: The Conservative Promise

American Bakers Association e

2022, https:/Awww.dropbox.com/s/yfyvO4ilkon
0%20Address%20Global%20Commodity%20Supply%20Cha
to increase food production

Tools%20
December 15, 2022). It is also n
25 percent of idled land is cons
not producin
Conservation
fairness that
eligible for many U
Conservation
from using parts o
farmers can lose a
cha
empowered
wetland-or-erodible-declared areas are
revoke access to federal resources and s
There must be a fa
Inflation Continues to Worsen. Here’s W
www.dailysignal.com/2022/04/25/food
about-it/ (accessed December 15, 2022)
Agriculture, Natural Resources Conserva

ecessary

Reserve Program

idered pri
g food—and this does not include
should be elim
should be addressed: challenging
SDA programs, farmers must comply
compliance of wetlands and high
their property. If farmers p
| access to USDA programs and support. For farmers,
lenging NRCS determinations, including
0 declare areas wetlands and highly erodible a

ir and reasonable process

al., letter to U.S. Department of Agricul

ime farm

y
an

het

used ina

hat Shou
-pric
“Am

nrcs.usda.gov/getting-assistance/compli
2022); and Chris Bennett, “Regulato
AG Web, Augus
veteran-wins-10
Fortunately, the
programs. One particular example, t
Protection Act model policy, is availab
wetlands programs. American Legisla
16, 2017, https://alec.org/model-po
new Administration should focus on bes
support the policies contained within

compliance rules to protect farmers and
anning the practice of re-engagin
eas of their farms. See NRCS We
tos:/\www.congress.gov/bill/117
bid
See,

-year-wetlands-figh

fap)

b
a land
h

or example, Daren Bakst an
Heritage Foundation /ssue Brief
reducing-federal-barriers-the-sa
Service, “State Inspection Programs,” u

0. 50

ent of Agricu
ptember 7, 20

U.S. Departm
Program,” Se

he “N

g farmers

d Jeremy
e-meat, and U
inspection-programs (accessed December

ure, Food Safety and Inspection Service, “Cooperative
22, https://www-sis.

€ are already resources available to help states esta
he American Legislative Exchan

ranchers

Com
78, June

pdated J

other lan
inated. Th
RCS de

ubsidies by making
or farmers to c

e-inflation-continuin
erican Bakers Associ
ion Service, “Conservation Complian
ance/conservation-compliance-appeals-process (accessed December 15,
y Hell: Farmer and Veteran Wins 10-Year Wetlands Fight Wi
30, 2021, https://\www.agweb.com/news/crops/crop-produc
(accessed December 15, 2022).

in new tec
pliance and Appea
h-congress/senate-b

Dalrymple, “Reduci

5, 2022).

om
e-quarter of idled lan
viab

land. Therefore, on
d that may
ere are also

erminations

d problems with
with certain conservation provisi
e lands consist of federal restrict
or modify the areas federal offici

erodib
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d costs of challen
eas, whi
manner deemed

ime an ging the federa

ch are therefore off

y be used for food production.
issues connected

here are real, practical concern

unacceptable by federa

ure Secretary Tom Vilsack, March 23,
nlizd/USDA%20Letter%20to%20Secretary%20Vilsack%200n%20
lenges%203.23.22_.pdf?dl=0 (accessed
itigate high food inflation. Approximately

dis merely idling,
The
0 property rights and
USDA easements. To be
ons enforced by NRCS.
ons that prevent farmers
Is deem protected,

s to
bureaucracy. NRCS is
imits for farming. If these

officials, NRCS may

determinations tha
such ac

echnica
hallenge
ld Be Done About |

ation et.al.,

blish thei
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or states to define the procedures, guidelines, an
ve Exchange Council, ‘
icy/wetlands-mapping-an
practices instead of
RCS Wetlan

‘Wetlands Mapping and Pro
d-protection-act/ (accessed
imposing prescriptive feder
d Compliance and Appeals Refor
by adding protecti
hnica

s Reform Act, S. 4931, 117
ill/4931?s=18&r=8 (accessed Decem

ng Federal Barriers for t

ion/regulatory-he

own wetlands co
I's Wetlands Mappi

carry potential penalties.

ions. See Daren Bakst, “Food Price
,” The Daily Signal, April 25, 2022, https://
g-to-worsen-heres-what-should-be-done-
etter to Vilsack; U.S. Department of
ce Appeals Process,” https://www.

th Government,”
-farmer-and-
nservation
ng and
nistration of

Act,” November
mber 16, 2022). The
ctices. It should

” and modify NRCS

d admi
ectio
Decel
al pra
m Ac

ons against regulatory overreach—such as
determinations appeals processes

or the same
h Cong., 2nd Sess.,
ber 15, 2022).

he Sale of Meat,”

1, 2020, https://www.heritage.org/aari
S. Departmen
anuary 12, 2023, ht

nte
on-

usda.gov/inspection/state-inspecti

culture/report/

t of Agriculture, Food Safety and Inspection
ps://www-sis.usda.gov/inspection/state-

rstate Shipping
programs/cooperative-

interstate-shipping-progra
U.S. Department of Agricu
The Senate bill removes ob:
poultry. New Markets for S

m (accessed December
ure, “State Inspection PI
stacles for both meat an
ate-Inspected Meat and

www.congress.gov/bill/117

h-congress/senate-bill/

rogra

Poul

sold%20in%20interstate%20commerce (accessed Decen

Inspected Meat Processors

Act of 2021, H.R. 1998, 1

5, 2022).

ms.”

— 316 —

d poultry. The H
ry Act of 2021, S. 107, 117th Cong,, Ist Sess., https://
O7#:~:text=This%20bilI%20allows%20meat%20and,be%20
nber 15, 2022), and Expanding Markets for State-

7th Cong,, Ist Sess., httos://www.congress.gov/bill/I17th-
congress/house-bill/1998 (accessed December 15, 2022).

ouse version does not appear to cover

104.

105.

106.

112.

113.
114.

107.

108.

109.
110.

111.

120.

2025 Presidential Transition Project

U.S. Department of Agriculture, Agricultural Marketing Service, “Specialty Crops Marketing Orders &
Agreements,” https://(www.ams.usda.gov/rules-regulations/moa/fv (accessed December 15, 2022).

See, for example, U.S. Department of Agricu

ture, Agricultural Marketing Service, “Commodities Covered

by Marketing Orders,” https://www.ams.usda.gov/rules-regulations/moa/commodities (accessed March

18, 2023), and Elayne Allen and Darren Baks
2016, https://www.dailysignal.com/2016/08/
March 18, 2023).
U.S. Department of Agriculture, Agricultural

, ‘How the Government Is Mandating Food Waste,” August 19,
19/how-the-government-is-mandating-food-waste/ (accessed

arketing Service, “Frequently Asked Questions Regarding the

Beef Checkoff Program Petition Process,” ht

beef/petition (accessed December 16, 2022):

ps://www.ams.usda.gov/rules-regulations/research-promotion/
: “Beef Producers: Do You Want to Vote on the Checkoffe” Beef

Magazine, July 28, 2020, https://www.beefmagazine.com/marketing/beef-producers-do-you-want-vote-

checkoff (accessed December 16, 2022); and
Access to Producer Database,” Nebraska TV,
beef-checkoff-referendum-asks-for-access-t

See, for example, Federal! Register, Vol. 86, N

Steve White, “Group Seeking Beef Checkoff Referendum Asks for
May 4, 2021, https://nebraska.tv/news/ntvs-grow/group-seeking-
o-producer-database (accessed December 16, 2022). As reported,

“There has not been a referendum of the mandatory National Beef Checkoff Program in 35 years.”

0. 213 (November 8, 2021), p. 61718, https://www.govinfo.gov/

content/pkg/FR-2021-11-08/pdf/2021-24301.pdf (accessed December 16, 2022).

(accessed December 15, 2022).
bid.

usda.gov/programs/market-access-program
To learn about trade barriers for food and ag

December 16, 2022).

mexicos-plan-to-block-imports-of-gm-corn

https://www.grassley.senate.gov/news/news

bid.
U.S. Departmen
httos://www.usd

Agriculture, U.S. Forest S

a oO

U.S. Department of Agriculture, U.S. Forest S
andmanagement/resourcemanagement/?ci

(accessed December 16, 2022).

on-american-corn (accessed December 15, 2022).
“The Federal Land Management Agencies,” Congressional Research Service /n Focus, updated February 16,
2021, https://sgp.fas.org/crs/misc/IF10585.pdf (accessed December 16, 2022).

U.S. Department of Agriculture, Foreign Agricultural Service, “Topics,” https://www.fas.usda.gov/topics

U.S. Department of Agriculture, Foreign Agricultural Service, “Market Access Program (MAP),” https://www.fas.

-map (accessed December 16, 2022).
ricultural products, see, for example, News release, “USTR

Releases 2022 National Trade Estimate Report on Foreign Trade Barriers,” Office of the U.S. Trade
Representative, March 31, 2022, https://ustr.gov/about-us/policy-offices/press-office/press-releases/2022/
march/ustr-releases-2022-national-trade-estimate-report-foreign-trade-barriers (accessed

U.S. Department of Agriculture, Economic Research Service, “Recent Trends in GE Adoption,” September 14,
2022, https://www.ers.usda.gov/data-products/adoption-of-genetically-engineered-crops-in-the-u-s/recent-
rends-in-ge-adoption/ (accessed December 15, 2022).
ational Bioengineered Food Disclosure Standard, Public Law 114-216.
oi Mahoney, “Trade Dispute Arising Over Mexico’s Plan to Block Imports of Genetically Modified Corn,”
Freight Waves, November 22, 2022, https://www.freightwaves.com/news/trade-dispute-arising-over-

(accessed December 15, 2022), and News release, “Grassley, Ernst,

Urge USTR to Intervene In Mexico’s Ban on American Corn,” Office of Chuck Grassley, November 14, 2022,

-releases/grassley-ernst-urge-ustr-to-intervene-in-mexicos-ban-

ervice, Fiscal Year 2023: Budget Justification, March 2022, p. 1,

.gov/sites/default/files/documents/30a-2023-FS.pdf (accessed December 16, 2022).
Forests and Rangelands, /he National Strategy: The Final Phase in the Development of the National Cohesive
ildland Fire Management Strategy, April 2014, https://www.forestsandrangelands.gov/documents/strategy/
rategy/CSPhaselllNationalStrategyApr2014.pdf (accessed December 16, 2022).

ervice, “Unplanned Fires,” https://www.fs.usda.gov/detail/inyo/
d=stelprd3804071 (accessed December 16, 2022).

See, for example, Sherry Devlin, “A Conversation with Jim Hubbard: Unplanned Wildfires Rule West's
Forests,” TreeSource, March 28, 2017, https://treesource.org/news/lands/jim-hubbard-forest-service-wildfires/

— 317 -—

Mandate for Leadership: The Conservative Promise

121. U.S. Department of Agriculture, U.S. Forest Service, “FY 1905-2021 National Summary Cut and Sold Data
Graphs,” https://www.fs.usda.gov/forestmanagement/documents/sold-harvest/documents/1905-2021_Natl_
Summary_Graph_wHarvestAcres.pdf (accessed December 16, 2022), and U.S. Department of Agriculture, U.S.
Forest Service, “Forest Products Cut and Sold from the National Forests and Grasslands,” httos://Awww.fs.usda.
gov/forestmanagement/products/cut-sold/index.shtml (accessed December 16, 2022).

122. Donald J. Trump, “Promoting Active Management of America’s Forests, Rangelands, and Other Federal Lands
0 Improve Conditions and Reduce Wildfire Risk,” Executive Order 13855, December 21, 2018, https://www.
govinfo.gov/content/pkg/DCPD-201800866/pdf/DCPD-201800866.pdf (accessed December 16, 2022).

123. Ibid.
124. Ibid.
125. Dietary Guidelines for Americans, https://www.dietaryguidelines.gov/ (accessed December 16, 2022).

126. Dietary Guidelines for Americans, “History of the Dietary Guidelines,” https://www.dietaryguidelines.gov/
about-dietary-guidelines/history-dietary-quidelines (accessed December 16, 2022).

127. Daren Bakst, “Extreme Environmental Agenda Hijacks Dietary Guidelines: Comment to the Advisory
Committee,” The Daily Signal, July 17, 2014, https://www.dailysignal.com/2014/07/17/extreme-environmental-
agenda-hijacks-dietary-guidelines-comment-advisory-committee/ (accessed December 16, 2022).

128. Healthy, Hunger-Free Kids Act of 2010, S. 3307, 1th Cong., 2nd Sess., httos:/Awww.congress.gov/bill/TIth-
congress/senate-bill/3307/text (accessed December 16, 2022), and Dietary Guidelines for Americans, “Current
Dietary Guidelines,” https://www.dietaryguidelines.gov/usda-hhs-development-dietary-guidelines (accessed
December 16, 2022).

— 318 —

DEPARTMENT OF
EDUCATION
Lindsey M. Burke

MISSION

Federal education policy should be limited and, ultimately, the federal Depart-
ment of Education should be eliminated. When power is exercised, it should
empower students and families, not government. In our pluralistic society, fami-
lies and students should be free to choose from a diverse set of school options and
learning environments that best fit their needs. Our postsecondary institutions
should also reflect such diversity, with room for not only “traditional” liberal arts
colleges and research universities but also faith-based institutions, career schools,
military academies, and lifelong learning programs.

Elementary and secondary education policy should follow the path outlined
by Milton Friedman in 1955, wherein education is publicly funded but education
decisions are made by families. Ultimately, every parent should have the option
to direct his or her child’s share of education funding through an education sav-
ings account (ESA), funded overwhelmingly by state and local taxpayers, which
would empower parents to choose a set of education options that meet their child’s
unique needs.

States are eager to lead in K-12 education. For decades, they have acted inde-
pendently of the federal government to pioneer a variety of constructive reforms
and school choice programs. For example, in 2011, Arizona first piloted ESAs, which
provide families roughly 90 percent of what the state would have spent on that
child in public school to be used instead on education options such as private school
tuition, online courses, and tutoring. In 2022, Arizona expanded the program to
be available to all families.

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Mandate for Leadership: The Conservative Promise

The future of education freedom and reform in the states is bright and will
shine brighter when regulations and red tape from Washington are eliminated.
Federal money is inevitably accompanied by rules and regulations that keep the
influx of funds from having much, if any, impact on student outcomes. It raises the
cost of education without raising student achievement. To the extent that federal
taxpayer dollars are used to fund education programs, those funds should be block-
granted to states without strings, eliminating the need for many federal and state
bureaucrats. Eventually, policymaking and funding should take place at the state
and local level, closest to the affected families.

Although student loans and grants should ultimately be restored to the private
sector (or, at the very least, the federal government should revisit its role as a guarantor,
rather than direct lender) federal postsecondary education investments should bolster
economic growth, and recipient institutions should nourish academic freedom and
embrace intellectual diversity. That has not, however, been the track record of federal
higher education policy or of the many institutions of higher education that are hostile
to free expression, open academic inquiry, and American exceptionalism. Federal post-
secondary policy should be more than massive, inefficient, and open-ended subsidies
to “traditional” colleges and universities. It should be rebalanced to focus far more on
bolstering the workforce skills of Americans who have no interest in pursuing a four-
year academic degree. It should reflect a fuller picture of learning after high school,
placing apprenticeship programs of all types and career and technical education on an
even playing field with degrees from colleges and universities. Rather than continuing
to buttress a higher education establishment captured by woke “diversicrats” and a
de facto monopoly enforced by the federal accreditation cartel, federal postsecondary
education policy should prepare students for jobs in the dynamic economy, nurture
institutional diversity, and expose schools to greater market forces.’

OVERVIEW

For most of our history, the federal government played a minor role in education.
Then, over a 14-month period beginning in 1964, Congress planted the seeds for
what would become the U.S. Department of Education (ED or the department).
In July of that year, President Lyndon B. Johnson signed into law the Civil Rights
Act of 1964, after Congress reached a consensus that the mistreatment of black
Americans was no longer tolerable and merited a federal response. In the case
of the Elementary and Secondary Education Act of 1965 (ESEA)? and the Higher
Education Act of 1965 (HEA), Congress sought to improve educational outcomes
for disadvantaged students by providing additional compensatory funding for
low-income children and lower-income college students.

Spending on ESEA and the HEA—part of Johnson’s “War on Poverty”—grew
exponentially in the years that followed. By Fiscal Year 2022, ESEA programs
received $27.7 billion in appropriations, in addition to $190 billion that came

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2025 Presidential Transition Project

through the pandemic’s Elementary and Secondary Schools Emergency Relief
(ESSER) Funds,’ which relied on ESEA formulas. The same year, the department
spent more than $2 billion just to administer Title IV of the HEA, which authorizes
federal student loans and Pell grants. It provided $22.5 billion in Pell grants, and
it oversaw outlays of close to $100 billion in direct student loans.

Since 1965, Congress has continued to layer on dozens of new laws and pro-
grams as federal “solutions” to myriad education problems. In 1973, it passed the
Rehabilitation Act,° and, in 1975, the Individuals with Disabilities Education Act
(IDEA)*° to address educational neglect of students with disabilities. In 2002, it cre-
ated the Institute for Education Sciences to consolidate education data collection
and fund research. Congress has also enacted a series of Carl D. Perkins Career and
Technical Education Acts, including Perkins V in 2018.’

Congress could have, and once did, distribute management of federal education
programs outside of a single department. But for those interested in expanding
federal funding and influence in education, this unconsolidated approach was less
than ideal, because a single, captive agency would allow them to promote their
agenda more effectively across Administrations. Eventually, the National Educa-
tion Association made a deal and backed the right presidential candidate— Jimmy
Carter—who successfully lobbied for and delivered the Cabinet-level agency.

When it was established in 1979—becoming operational in 1980—the agency
was supposed to act as a “corralling” mechanism. Carter signed the Department
of Education Organization Act® into law in 1979, believing in part that it would
reduce administrative costs and improve efficiency by housing most of the federal
education programs that had proliferated in the wake of Johnson’s War on Poverty
under one roof.

It has had the opposite effect. Instead, special interest groups like the National
Education Association (NEA), American Federation of Teachers (AFT), and the
higher education lobby have leveraged the agency to continuously expand federal
expenditures—a desirable funding stream from their vantage point because federal
budgets are not constrained like state and local budgets that must be balanced each
year. By FY 2022, the department’s discretionary and mandatory appropriation
topped $80 billion, not including student loan outlays. Each of its programs has
attendant federal strings and red tape.

One recent example is the Biden Administration’s requirement that state educa-
tion agencies and school districts submit “equity” plans as a condition of receiving
COVID recovery ESSER funds in the American Rescue Plan (ARP).? This exercise
led to the hiring of numerous new government employees as the rules were pro-
mulgated, plans were created after collecting public feedback, and those plans
were eventually deemed satisfactory.

The next Administration will need a plan to redistribute the various congres-
sionally approved federal education programs across the government, eliminate

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Mandate for Leadership: The Conservative Promise

those that are ineffective or duplicative, and then eliminate the unproductive red
tape and rules by entrusting states and districts with flexible, formula-driven block
grants. This chapter details that plan.

As the next Administration executes its work, it should be guided by a few core
principles, including:

e Advancing education freedom. Empowering families to choose among
a diverse set of education options is key to reform and improved outcomes,
and it can be achieved without establishing a new federal program. For
example, portability of existing federal education spending to fund families
directly or allowing federal tax credits to encourage voluntary contributions
to K-12 education savings accounts managed by charitable nonprofits, could
significantly advance education choice.

e Providing education choice for “federal” children. Congress has a
special responsibility to children who are connected to military families,
who live in the District of Columbia, or who are members of sovereign tribes.
Responsibility for serving these students should be housed in agencies that
are already serving these families.

e Restoring state and local control over education funding. As
Washington begins to downsize its intervention in education, existing
funding should be sent to states as grants over which they have full control,
enabling states to put federal funding toward any lawful education purpose
under state law.

e Treating taxpayers like investors in federal student aid. Taxpayers
should expect their investments in higher education to generate economic
productivity. When the federal government lends money to individuals for a
postsecondary education, taxpayers should expect those borrowers to repay.

e Protecting the federal student loan portfolio from predatory
politicians. The new Administration must end the practice of acting like
the federal student loan portfolio is a campaign fund to curry political
support and votes. The new Administration must end abuses in the loan
forgiveness programs. Borrowers should be expected to repay their loans.

e Safeguarding civil rights. Enforcement of civil rights should be based on

a proper understanding of those laws, rejecting gender ideology and critical
race theory.

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2025 Presidential Transition Project

e Stopping executive overreach. Congress should set policy—not
Presidents through pen-and-phone executive orders, and not agencies
through regulations and guidance. National emergency declarations should
expire absent express congressional authorization within 60 days after the
date of the declaration.

Bolstered by an ever-growing cabal of special interests that thrive off federal
largesse, the infrastructure that supports America’s costly federal intervention
in education from early childhood through graduate school has entrenched itself.
But, unlike the public sector bureaucracies, public employee unions, and the higher
education lobby, families and students do not need a Department of Education
to learn, grow, and improve their lives. It is critical that the next Administration
tackle this entrenched infrastructure.

NEEDED REFORMS

Federal intervention in education has failed to promote student achievement.
After trillions spent since 1965 on the collective programs now housed within
the walls of the department, student academic outcomes remain stagnant. On
the main National Assessment of Educational Progress (NAEP), reading out-
comes on the 2022 administration have remained unchanged over the past 30
years. Declines in math performance are even more concerning than students’
lack of progress on reading outcomes. Fourth- and eighth-grade math scores
saw the largest decline since the assessments were first administered in 1990.
Average fourth-grade math scores declined five points, and average eighth-grade
math scores declined eight points. Just one-third of eighth graders nationally
are proficient in reading and math. Just 27 percent of eighth graders were pro-
ficient in math in 2022, and just 31 percent of eighth graders scored proficient
in reading in 2022.

The NAEP Long-term Trend Assessment shows academic stagnation since the
1970s, with particular stagnation in the reading scores of 13-year-old students since
1971, when the assessment was first administered. Math scores, though modestly
improved, are still lackluster.

Additionally, the department has created a “shadow” department of education
operating in states across the country. Federal mandates, programs, and proclama-
tions have spurred a hiring spree among state education agencies, with more than
48,000 employees currently on staff in state agencies across the country. Those
employees are more than 10 times the number of employees (4,400)” at the federal
Department of Education, and their jobs largely entail reporting back to Washing-
ton. Research conducted by The Heritage Foundation’s Jonathan Butcher finds
that the federal government funds 41 percent of the salary costs of state educa-
tion agencies."

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Mandate for Leadership: The Conservative Promise

CHART 1

Trends in Fourth- and Eighth-Grade Reading

EIGHTH-GRADE READING, AVERAGE SCORES

270
oO
e@
265 t e
@ fe)
@ co) ie) e@
= 263
260 @ @ e
260
255
1992 1994 1998 02’03. +2005 2007 2009 2011 2013 2015 2017 2019 2022
FOURTH-GRADE READING, AVERAGE SCORES
225
@
co) e@
e @ e@
220 e
© © 220
e
e 2)
217
215 e
oO
e
10
1992 1994 1998 2000 ’02’°03 2005 2007 2009 2011 2013 2015 2017 2019 2022

SOURCES: The Nation’s Report Card, “National Average Scores,” Grade 4, https://www.nationsreportcard.gov/
reading/nation/scores/?grade=4 (accessed March 17, 2023), and The Nation’s Report Card, “National Average
Scores,” Grade 8, https://www.nationsreportcard.gov/reading/nation/scores/?grade=4 (accessed March 17, 2023).

& heritage.org

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2025 Presidential Transition Project

This bloat has persisted for decades. In 1998, a commission led by Repre-
sentative Pete Hoekstra released a critical report based on extensive fieldwork,
interviews, and analysis of the Department of Education. The report, Education
at a Crossroads: What Works and What’s Wasted in Education Today, detailed the
suffocating bureaucratic red tape Carter’s agency had wrapped around states.” The
commission estimated that states completed nearly 50 million hours of paperwork
just to get their federal education spending, which at that time, they estimated,
resulted in just 65 cents to 70 cents of each federal taxpayer dollar making its way
to the classroom. The situation has only worsened since the Hoekstra report. More
recent evidence of Washington’s bureaucratic paperwork burden can be found
in the growing number of non-teaching staff in public schools across the country,
which doubled relative to growth in student enrollment from 1992 to 2015.

The labyrinthian nature of federal education programs—convoluted funding
formulas, competitive grant applications, reporting requirements, etc.—has likely
contributed to the considerable bureaucratic bloat in state and local school districts
across the country and is one of the key areas of needed reform. Streamlining exist-
ing programs and funding so that dollars are sent to states through straightforward
per-pupil allocations or in the form of grants that states can put toward any lawful edu-
cation purpose under state law would bring a needed easing of the federal compliance
burden. The federal government should confine its involvement in education policy
to that ofa statistics-gathering agency that disseminates information to the states.

To improve educational opportunities for all Americans, the next Administra-
tion should work with Congress to pass a Department of Education Reorganization
Act to reform, eliminate, or move the department’s programs and offices to appro-
priate agencies. The following is an overview of what should happen within each
of the offices and to each of the programs currently operated by the department.

PROGRAM AND OFFICE PRIORITIZATION WITHIN THE DEPARTMENT

Office of Elementary and Secondary Education (OESE)

The OESE is comprised of 36 programs, ranging from Title I, Part A, of the
Elementary and Secondary Education Act and Impact Aid, to programs for Native
American students and the D.C. Opportunity Scholarship Program.

e Reduce the number of programs managed by OESE, and transfer
some remaining programs to other federal agencies.

e Transfer Title I, Part A, which provides federal funding for lower-
income school districts, to the Department of Health and Human
Services, specifically the Administration for Children and Families. It
should be administered as a no-strings-attached formula block grant.

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Mandate for Leadership: The Conservative Promise

e Restore revenue responsibility for Title I funding to the states overa
10-year period.

OESE also currently manages the federal Impact Aid program, which provides fund-
ing to school districts to compensate for reductions in property tax revenue due to the
presence of federal property (such as that associated with a military base or tribal lands).

e Eliminate Impact Aid not tied to students.

e Move student-driven Impact Aid programs to the Department
of Defense Education Authority (DoDEA) or the Department of
Interior’s Bureau of Indian Education.

e Transfer all Indian education programs to the Bureau of
Indian Education.

e The D.C. Opportunity Scholarship Program, which provides vouchers
to low-income children living in the nation’s capital—appropriate as
D.C. is under the jurisdiction of Congress—should be expanded into a
universal program, formula-funded, and moved to the Department of
Health and Human Services.

e Allother programs at OESE should be block-granted or eliminated.

Office of Career, Technical, and Adult Education
e Transfer the Office of Career, Technical, and Adult Education’s few
programs to the Department of Labor, but

e Move the Tribally Controlled Postsecondary Career and Technical
Education Program to the Bureau of Indian Education.

Office of Special Education and Rehabilitative Services (OSERS)

The Office of Special Education and Rehabilitative Services (OSERS) houses
nearly two dozen programs, ranging from funding for the Individuals with Dis-
abilities Education Act (IDEA) and the National Technical Institute for the Deaf
to Special Olympics Funding and the American Printing House for the Blind.

e Most IDEA funding should be converted into a no-strings formula
block grant targeted at students with disabilities and distributed
directly to local education agencies by Health and Human Service’s
Administration for Community Living.

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2025 Presidential Transition Project

Transfer the Vocational Rehabilitation Grants for Native American
students to the Bureau of Indian Education.

Phase out earmarks for a variety of special institutions, as
originally envisioned.

To the extent that OSERS supports federal efforts to enforce our laws
against discrimination of individuals with disabilities, those assets
should be moved to the Department of Justice (DOJ) along with the
Office for Civil Rights (OCR).

Office for Postsecondary Education (OPE)

The next Administration should work with Congress to eliminate or
move OPE programs to ETA at the Department of Labor.

Funding to institutions should be block-granted and narrowed to
Historically Black Colleges and Universities (HBCUs) and tribally
controlled colleges.

Move programs deemed important to our national security interests
to the Department of State.

Institute of Education Sciences (IES)

Move ED’s statistical office, the National Commission for Education
Statistics (NCES), to the Department of Commerce’s Census

Bureau. If Congress believes the federal government can play a valuable
research role, those research centers can be moved to the National Science
Foundation. If Congress decides to maintain IES as an independent agency,
it needs to address major governance and management issues that keep

it from being a productive contributor to the knowledge base related to
teaching and learning.

Office of Federal Student Aid (FSA)

The next Administration should completely reverse the student loan
federalization of 2010 and work with Congress to spin off FSA and
its student loan obligations to a new government corporation with
professional governance and management.

With a statutory charge that it preserve the federal student loan portfolio for

the benefit of the taxpayers and students, this new entity would be (1) profession-
ally governed by an agency head and board of trustees appointed by the President

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Mandate for Leadership: The Conservative Promise

CHART 2

Trends in Fourth- and Eighth-Grade Mathematics

EIGHTH-GRADE MATH, AVERAGE SCORES

300
290
e
e
. ~ e °-e
280
e 282
e
e
274
270 e
e
e
60
1990 1992 1996 2000 2003 2005 2007 2009 2011 2013 2015 2017 2019 2022
FOURTH-GRADE MATH, AVERAGE SCORES
250
e
240 oe * eo—e *
e 241
P @
236
230
Ps
e
220 e
e
10
1990 1992 1996 2000 2003 2005 2007 2009 2011 2013 2015 2017 2019 2022

SOURCES: The Nation’s Report Card, “National Average Scores,” Grade 4, httos:/\www.nationsreportcard.gov/
mathematics/nation/scores/?grade=4 (accessed March 17, 2023), and The Nation’s Report Card, “National Average
Scores,” Grade 8, https://www.nationsreportcard.gov/mathematics/nation/scores/?grade=4 (accessed March 17, 2023).

& heritage.org

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CHART 3

Long-Term Trends for Nine- and 13-Year-Olds

READING, AVERAGE SCORES

300
280
13-YEAR-OLDS
@
70 49 00-00-0099 © 963
240
NINE-YEAR-OLDS
220 ‘ ee ae
- e ) e eee eo-e@

00
1971 1975 1980 1984 ’88 ’90 ’92 94 ’96 1999 2004 2008 2012

MATH, AVERAGE SCORES
300
13-YEAR-OLDS a
r) °
280 cease 285
@ e ®
e
260
NINE-YEAR-OLDS Z
r)
— 244

220 @ @

00
1978 1982 1986 90 °92 94 96 1999 2004 =2008 =2012

2020

280

24)

2020

SOURCE: The Nation’s Report Card, “NAEP Data Explorer,” https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?

n=PET&S=WCSSTUSI&f=W (accessed March 17, 2023).

& heritage.org

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Mandate for Leadership: The Conservative Promise

with the advice and consent of the Senate; (2) funded with annual appropriations
from Congress; and (3) operated by professional managers. Federal loans would
be assigned directly to the Treasury Department, which would manage collections
and defaults. The new federal student loan authority would manage the loan port-
folio, handle borrower relations, administer loan applications and disbursements,
monitor institutional participation and accountability issues, and issue regulations.

Office for Civil Rights (OCR)

e OCR should move to the Department of Justice. The federal government
has an essential responsibility to enforce civil rights protections, but
Washington should do so through the Department of Justice and federal
courts. The OCR at DOJ should be able to enforce only through litigation.

Additional Bureaus and Offices

For those attorneys, accountants, experts, and specialists in the department's
remaining offices subject to closure whose positions might nevertheless be a key
component of serving the mission—positions that might include the Office of the
Secretary/Deputy Secretary, Office of the Undersecretary, Office of the General
Counsel, Office of the Inspector General, Office of Finance and Operations, Office of
the Chief Information Officer, Office of Communications and Outreach, and Office
of Legislative and Congressional Affairs—the opportunity to join other agencies
based on their expertise and the needs of other agencies should be made available.
For example, OGC higher education lawyers would join the newly independent
Federal Student Aid Office or the Department of Labor, and OGC civil rights attor-
neys would join DOJ. These positions must first be determined to serve a continued
mission need prior to being transferred.

e Attorneys, accountants, experts, and specialists in the department’s
remaining offices subject to closure, and whose positions are
indispensable to serving the mission, should have the opportunity to
join other agencies.

Current Laws Relating to the Department of
Education That Require Repeal

In order to fully wind down the Department of Education, Congress must pass
and the President must sign into law a Department of Education Reorganization
Act (or Liquidating Authority Act) to direct the executive branch on how to devolve
the agency as a stand-alone Cabinet-level department.

e Congress should pass and the next President should sign a
Department of Education Reorganization Act.

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Current Regulations Promulgated by or Relevant to the
Agency That Should Be Rolled Back or Eliminated

While the next Administration works to distribute department programs
across the federal government, it will need to thoroughly review the many educa-
tion-related regulations promulgated by the Biden Administration. There are five
primary regulatory targets (as of December 2022) that require the next Adminis-
tration’s attention: regulations on (1) Charter School Grant Program Priorities; (2)
Civil Rights Data Collection; (3) Student Assistance General Provisions, Federal
Perkins Loan Program, and William D. Ford Federal Direct Loan Program Final
Regulations; (4) Nondiscrimination on the Basis of Sex in Education Programs or
Activities Receiving Federal Financial Assistance (Title IX); and (5) Assistance
to States for the Education of Children with Disabilities, Preschool Grants for
Children with Disabilities (Equity in IDEA). The next Administration should also
review regulatory changes to the school meals program (under the Department of
Agriculture) and changes to the Income-Driven student loan program. Additional
Biden Administration regulations on (1) gainful employment, administrative capa-
bility, and financial responsibility for institutions that participate in the federal
student loans and grant programs; (2) Title VI, (3) accreditation of postsecondary
institutions, and (4) female athletics are expected in to be released in 2023.

e Thoroughly review the many education-related regulations
promulgated by the Biden Administration, as well as the school meals
program and the Income-Driven student loan program.

Charter School Grant Programs

Congress first authorized the Charter School Program (CSP) in 1994 [Title X,
Part C of the Elementary and Secondary Education Act of 1965 (ESEA), as amended,
20 U.S.C. § 8061 et seq. (1994)]. It most recently reauthorized the program in 2015
as part of the Every Student Succeeds Act.'* On March 14, 2022, the department
published a notice concerning proposed priorities, requirements, definitions, and
grant selection criteria relating to the award of federal grants to applicants in CSP.
This proposal increases the federal footprint in the charter school sector by ignor-
ing statute and adding to the list of requirements imposed on charter schools.

e The new Administration must take immediate steps to rescind
the new requirements and lessen the federal restrictions on
charter schools.

Civil Rights Data Collection

On December 13, 2021, OCR published a notice concerning proposed revisions
to OCR’s Mandatory Civil Rights Data Collection (CRDC) in which it proposed

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to create and collect data on a new “nonbinary” sex category (in addition to the
current “male” or “female” sex categories) and to retire data collection that indi-
cates the number of (1) high school-level interscholastic athletics sports in which
only male and female students participate, (2) high school-level athletics teams
in which only male or female students participate, and (3) participants on high
school-level interscholastic athletics sports teams in which only male or only
female students participate. These poorly conceived changes are contrary to law,
fail to take account of student privacy interests and statutory protections favoring
parental rights under the Protection of Pupils Rights Amendment, and jettison
longstanding data collections that assist in the enforcement of Title IX.

e The new Administration must quickly move to rescind these changes,
which add a new “nonbinary” sex category to OCR’S data collection
and issue a new CRDC that will collect data directly relevant to OCR’s
statutory enforcement authority.

Student Assistance General Provisions, Federal Perkins Loan Program,
and William D. Ford Federal Direct Loan Program Final Regulations
Effective July 1, 2023, the department promulgated final regulations addressing
loan forgiveness under the HEA’s provisions for borrower defense to repayment
(“BDR”), closed school loan discharge (“CSLD”), and public service loan forgive-
ness (“PSLF”). The regulations also included prohibitions against pre-dispute
arbitration agreements and class action waivers for students enrolling in institu-
tions participating in Title IV student loan programs. Acting outside of statutory
authority, the current Administration has drastically expanded BDR, CSLD, and
PSLF loan forgiveness without clear congressional authorization at a tremendous
cost to the taxpayers, with estimates ranging from $85.1 to $120 billion.

e The new Administration must quickly commence negotiated
rulemaking and propose that the department rescind these regulations.

e The next Administration should also rescind Dear Colleague Letter
(DCL) GEN 22-11 and DCL GEN 22-10 and its letters to accreditation
agencies dated July 19, 2022, which are attempts to undercut Florida’s
SB 7044, providing universities more flexibility on accreditation.

Nondiscrimination on the Basis of Sex in Education Programs or
Activities Receiving Federal Financial Assistance (Title IX)

With its Notice of Proposed Rulemaking published on July 12, 2022, the Biden
Education Department seeks to gut the hard-earned rights of women with its
changes to the department’s regulations implementing Title IX, which prohibits

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discrimination on the basis of sex in educational programs and activities. Instead,
the Biden Administration has sought to trample women’s and girls’ athletic oppor-
tunities and due process on campus, threaten free speech and religious liberty, and

erode parental rights in elementary and secondary education regarding sensitive

issues of sex. The new Administration should take the following steps:

e Work with Congress to use the earliest available legislative vehicle
to prohibit the department from using any appropriations or from
otherwise enforcing any final regulations under Title IX promulgated
by the department during the prior Administration.

e Commence a new agency rulemaking process to rescind the
current Administration’s Title [IX regulations; restore the Title IX
regulations promulgated by then-Secretary Betsy DeVos on May 19,
2020; and define “sex” under Title IX to mean only biological sex
recognized at birth.

e Work with Congress to amend Title IX to include due process
requirements; define “sex” under Title IX to mean only biological
sex recognized at birth; and strengthen protections for faith-based
educational institutions, programs, and activities.

The Trump Administration’s 2020 Title IX regulation protected the founda-
tional right to due process for those who are accused of sexual misconduct. The
Biden Administration’s proposed change to the interpretation of Title IX disposes
of these rights.

e The next Administration should move quickly to restore the rights

of women and girls and restore due process protections for accused
individuals.

At the same time, there is no scientific or legal basis for redefining “sex” to
“sexual orientation and gender identity” in Title IX. Such a change misrepresents
the U.S. Supreme Court’s opinion in Bostock, threatens the American system of
federalism, removes important due process protections for students in higher
education, and puts girls and women in danger of physical harm. Facilitating social
gender transition without parental consent increases the likelihood that children
will seek hormone treatments, such as puberty blockers, which are experimental
medical interventions. Research has not demonstrated positive effects and long-
term outcomes of these treatments, and the unintended side effects are still not
fully understood.

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e The next Administration should abandon this change redefining
“sex” to mean “sexual orientation and gender identity” in Title IX
immediately across all departments.

e Onits first day in office, the next Administration should signal
its intent to enter the rulemaking process to restore the Trump
Administration’s Title IX regulation, with the additional insistence
that “sex” is properly understood as a fixed biological fact. Official
notice-and-comment should be posted immediately.

e Atthe same time, the political appointees in the Office for Civil
Rights should begin a full review of all Title [IX investigations that
were conducted on the understanding that “sex” referred to gender
identity and/or sexual orientation.

e All ongoing investigations should be dropped, and all school districts
affected should be given notice that they are free to drop any policy
changes pursued under pressure from the Biden Administration.

e The OCR Assistant Secretary should prepare a report of OCR’s actions
for the new Secretary of Education, who should—by speech or letter—
publicize the nature of the overreach engaged in by his predecessor.

e The Secretary should make it clear that FERPA allows parents full
access to their children’s educational records, so any practice of
paperwork obfuscation on this front violates federal law.

Title VI—School Discipline and Disparate Impact

Assuring a safe and orderly school environment should be a primary consid-
eration for school leaders and district administrators. Unfortunately, federal
overreach has pushed many school leaders to prioritize the pursuit of racial parity
in school discipline indicators—such as detentions, suspensions, and expulsions—
over student safety. In 2014, the Obama Administration issued a Dear Colleague
Letter that muddied the standard for civil rights enforcement under Title VI for
student discipline cases. Before the DCL, a school would be in violation of federal
law for treating black and white students differently for the same offense (dispa-
rate treatment); under the Obama Administration schools were at risk of losing
federal funding if they treated black and white students equally but had aggregate
differences in the rates of school discipline by race (disparate impact).

OCR leveraged federal civil rights investigations as policy enforcement tools;
these investigations could only end when school districts agreed to adopt lenient

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discipline policies, commonly known as “restorative justice.” Academic studies,
as well as student and teacher surveys, suggest that academics and school climate
have been harmed substantially by this push.

The Trump Administration rescinded the Obama Administration’s guidance
on school discipline and corrected the Obama Administration’s overreach in Title
VI enforcement.

e The next Administration should continue the policy of the Trump
Administration in this area and direct the department to conduct a
comprehensive review of all Title VI cases to ascertain to what extent
these cases include allegations of disparate impact.

e OCR should also review all resolution agreements with school
districts to conform with this policy.

e_ As part of this effort, the new Administration should also direct the
department and DOJ jointly to issue enforcement guidance stating
that the agencies will no longer investigate Title VI cases that
exclusively rest on allegations of disparate impact.

e To the extent that the Biden Administration publishes guidance
or promulgates a regulation on this topic, the next Administration
should rescind the guidance and commence rulemaking to rescind
the regulation.

Getting the federal government out of the business of dictating school discipline
policy is a good start. But if the next conservative Department of Education simply
rescinds the Biden-era regulation, it could very easily be enforced again on Day
One through a Dear Colleague Letter by another leftist Administration.

e In addition to rescinding the policy and any related guidance, the next
Secretary should work with the next Attorney General on a regulation
that would clarify current regulations to state that Title VI of the
Civil Rights Act does not include a disparate impact standard.

As law professor Gail Heriot has noted, the alleged existence of a disparate
impact standard under Title VI makes everything presumed illegal unless given
special dispensation by the federal government.

e Although it would require political capital from the White House,

given that mainstream news outlets are sure to frame it as an attack

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on civil rights, the next conservative Administration should take
sweeping action to assure that the purpose of the Civil Rights Act is
not inverted through a disparate impact standard to provide a pretext
for theoretically endless federal meddling.

Assistance to States for the Education of Children with Disabilities;

Preschool Grants for Children with Disabilities (Equity in IDEA)

e Effective January 18, 2017, the department issued final regulations
under Part B of IDEA that require states to consider race and ethnicity
in the identification, placement, and discipline of students with
disabilities. The new Administration should rescind this regulation.

Students should never be denied access to special education services because of
their race or ethnicity, but this is happening in school districts across the country
thanks to the Obama Administration’s Equity in IDEA regulation. This was not the
intent of the regulation, but it is an inevitable byproduct of its flawed assumptions.
The Obama Administration looked at the racial statistics on special education
assignment and made two assumptions: that African American students were dis-
proportionately overrepresented, and that this overrepresentation constituted a
harm that required federal pressure to ameliorate.

School districts deemed to overrepresent minority students in special education
assignment, or in discipline amongst special education students, are tagged by
their state education agencies as engaging in “significant disproportionality,” and
are required to reallocate 15 percent of their IDEA Part B money into coordinated
early intervening services that are intended to address the “root causes of dispro-
portionality.” In practice, this can mean raiding special education funding to pay
for CRT-inspired “equity” consultants and professional development.

This is especially problematic given that both of the assumptions behind Equity
in IDEA are flawed. Special education services provide extra assistance to students;
they do not harm them. And according to the most rigorous research on the subject,
conducted by Penn State’s Paul Morgan, black students are actually underrep-
resented in special education once adequate statistical controls are made. That
means that this regulation effectively further depresses the provision of valuable
services to an already underserved group.

e The next Administration should immediately commence rulemaking
to rescind the Equity in IDEA regulation. No replacement regulation
is required.

e ©The Office of Special Education and Rehabilitative Services (OQSERS)

should prepare a digest of the best research on this subject and share

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it directly with state superintendents and state special education
leaders across the country, who have been led by this regulation to
believe a false problem diagnosis. Every effort should be made to dissuade
states from continuing to operate on the assumption that overrepresentation
requires state intervention after the federal pressure is rescinded.

Provide School Meals to Children in Need; Do Not Use
Federal Meals to Support Radical Ideology

In May 2022, the U.S. Department of Agriculture (USDA) tried to advance a
radical political agenda using the federal school meal program. Nearly a century
ago, federal lawmakers adopted the National School Lunch Program (NSLP) and
School Breakfast Program (SBP) and other services that provide meals for K-12
students to give children from low-income families access to food while at school.

Since the 1940s, federal lawmakers have greatly expanded these meal programs,
creating an entitlement for nearly all students, regardless of family income levels,
and have turned the meal programs into some of the most wasteful federal pro-
grams in Washington. Now, the USDA is threatening to withhold federal taxpayer
spending for these meals from schools that do not implement Title IX of the
Education Amendments of 1972 so that the term “sex” is replaced with “sexual
orientation and gender identity” (SOGD.

e The next Administration should prohibit the USDA or any other
federal agency from withholding services from federal or state
agencies—including but not limited to K-12 schools—that choose not to
replace “sex” with “SOGI” in that agency’s administration of Title IX.

The Administration will have significant support for this policy change among
state officials and Members of Congress. Twenty-two state attorneys general filed
a lawsuit after the USDA’s announcement that the agency intended to withhold
spending from schools that do not replace sex with SOGI. Members of Congress
also introduced legislation in 2022 that would prohibit the agency from carrying
out its intentions regarding Title IX.

Phase Out Existing Income-Driven Repayment Plans

While income-driven repayment (IDR) of student loans is a superior approach
relative to fixed payment plans, the number of IDR plans has proliferated beyond
reason. And recent IDR plans are so generous that they require no or only token
repayment from many students.

e The Secretary should phase out all existing IDR plans by making new
loans (including consolidation loans) ineligible and should implement

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a new IDR plan. The new plan should have an income exemption equal to
the poverty line and require payments of 10 percent of income above the
exemption. If new legislation is possible, there should be no loan forgiveness,
but if not, existing law would require forgiving any remaining balance

after 25 years.

President Biden has proposed a new income-driven repayment program that
would be extremely generous to borrowers, requiring only nominal payments from
most students. It would turn every policy lever to the most generous setting on
record (e.g., lowering the percentage of income owed from 10 percent to 25 per-
cent under existing plans to 5 percent, lowering the number of years of payment
required from 20 or 25 years to 10 years, and increasing income exemption from
150 percent to 225 percent of the poverty line). The median borrower who earns an
associate degree would owe only $15 a month, regardless of how much he or she had
borrowed. The median bachelor’s degree borrower would owe only $68 a month.
This plan essentially converts these student loans into delayed grant programs.

OTHER STRUCTURAL REFORMS THAT THE
DEPARTMENT OF EDUCATION REQUIRES

Reform Federal Education Data Collection

The National Assessment of Educational Progress (NAEP) and other data col-
lections currently release data by race, ethnicity, socioeconomic status, English
language proficiency, disability, and sex. However, one of the most important—if
not the most important—factor influencing student educational achievement and
attainment is family structure. As education scholar Ian Rowe has noted, NAEP
already collects data on students’ family structure; it just does not make those
data publicly available.

e The Department of Education (or whichever agency collects such
data long term) should make student data available by family
structure to the public, including as part of its Data Explorer tool.

e As discussed above, data collection efforts should be consolidated
under the Census Bureau.

e Data collection efforts in higher education should also be improved
by housing higher education data at the Department of Labor. This
would provide more transparency in evaluating postsecondary education
and workforce training program outcomes; contextualize those results
based on trends observed more generally; enable the adjusting of real

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wages to account for regional differences in earnings and cost of living; and
develop a reliable methodology for risk adjusting institutional and program
outcomes to more accurately reflect the value added of education programs
(as opposed to their admissions selectivity).

Currently the Department of Education relies on graduation rates and average
earnings as proxies for educational quality. Both of those outcomes, however, are
highly dependent upon a student’s socioeconomic background, sex, family status,
and other factors. Colleges and universities with selective admissions policies post
the strongest outcomes, primarily because they admit mostly low-risk, traditional
students. Open enrollment institutions post the weakest outcomes, largely because
life is challenging and complicated for low-income and non-traditional students,
who may be forced to drop out when a work schedule changes, a child needs more
attention, or an unexpected repair or medical bill makes continuing impossible.
Such confounding factors make it difficult to isolate the impact of educational qual-
ity versus socioeconomic factors on student outcomes. The Department of Health
and Human Services faced similar challenges in trying to evaluate healthcare out-
comes since social determinants of health result in worse health outcomes among
those who are socioeconomically disadvantaged, have low educational attainment
levels, have struggled with addiction, or have poor diet and exercise habits. Without
risk adjustment of outcomes, hospitals treating wealthy patients will always appear
to be delivering good care, and hospitals treating low-income patients will appear
to be delivering poor care. Higher education outcomes data should be similarly

“risk adjusted” to more carefully isolate the impact of educational quality versus
socioeconomic status and other factors on college outcomes.

Reform the Negotiated Rulemaking Process at ED

The U.S. Department of Education is required by statute" to engage in nego-
tiated rulemaking prior to promulgating new regulations under Subchapter 1 of
the Elementary and Secondary Education Act as well as Subchapters II (Teacher
Quality Enhancements) and IV of the Higher Education Act of 1964 (Student
Assistance). The purpose of negotiated rulemaking is to engage a committee of
stakeholders early in the drafting of proposed regulations to ensure that the reg-
ulation can be implemented as written, to understand any potential unintended
consequences, and to seek suggestions from stakeholders on alternative solutions.
The goal is for the negotiators to reach a consensus, thus smoothing the way to
promulgate a newrule.

Although it is helpful for the department to receive stakeholder input, the
negotiated rulemaking process has become an expensive and time-consuming
undertaking. Consensus is only rarely reached, enabling the department to pursue
its own path. The department’s master calendar (which requires final rules to be

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published by October 1if they are to be implemented by July 1st of the subsequent
year) compounds the problem, making it unduly challenging to update regulations
as needed to keep pace with changes in education, finance, accounting, pedagogy,
and student assessment.

In recent decades, negotiated rulemaking has become a veritable three-ring
circus, replete with negotiators who use their Twitter accounts and other social
media feeds during negotiations to denigrate the process and their peer negoti-
ators in real time. A few Members of Congress use the public comment process
to deliver political speeches, apparently to raise their own profiles but without
adding any new information to the process. Some advocacy groups have latched
onto the process for fundraising purposes, sometimes misrepresenting negotiation
language to agitate followers and supporters and encourage them to make financial
contributions. At times, the department itself has appeared to sabotage consensus,
which enables them to write the regulation as they wish and without regard to the
concerns raised by negotiators.

e The Department of Education should work with Congress to amend
the HEA to eliminate the negotiated rulemaking requirement. At
a minimum, Congress should allow the department to use public
hearings rather than negotiated rulemaking sessions.

Reform the Office of Federal Student Aid

This proposal urges the new Administration to end the abuse of FSA’s loan for-
giveness programs, to manage the federal student loan portfolio in a professional
way, and to work with Congress for a long-term overhaul of the program for the
benefit of students and taxpayers.

e The new Administration must end the prior Administration’s abuse
of the agency’s payment pause and HEA loan forgiveness programs,
including borrower defense to repayment, closed school discharge,
and Public Service Loan Forgiveness.

e The new Administration should also take immediate steps to
commence the rulemaking process to rescind or substantially modify
the prior Administration’s HEA regulations.

e The federal government does not have the proper incentives to
make sound lending decisions, so the new Administration should
consider returning to a system in which private lenders, backed
by government guarantees, would compete to offer student loans,
including subsidized and unsubsidized, loans. This would allow for

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market prices and signals to influence educational borrowing, introducing
consumer-driven accountability into higher education. Pell grants should
retain their current voucher-like structure.

If Congress is unwilling to reform federal student aid, then the next Adminis-
tration should consider the following reforms:

e Switch to fair-value accounting from FCRA accounting, and

e Consolidate all federal loan programs into one new program that
1. Utilizes income-driven repayment,
2. Includes no interest rate subsidies or loan forgiveness,
3. Includes annual and aggregate limits on borrowing, and

4. Requires “skin in the game” from colleges to help hold them
accountable for loan repayment.

The Biden Administration has mercilessly pillaged the student loan portfolio
for crass political purposes without regard to the needs of current taxpayers or
future students. This must never happen again.

e_ As detailed in Section III, the next Administration should work
with Congress to spin off federal student aid into a new government
corporation with professional governance and management.

NEW POLICY PRIORITIES FOR 2025 AND BEYOND

New Legislation That Should Be Prioritized

For nearly 250 years, Congress has incorporated public and private institutions,
including banks, the District of Columbia’s city government, and other organiza-
tions that federal officials deem to be conducting operations in the public interest.
Such charters offer a certain status to organizations, often viewed as a “seal of
approval” according to one Congressional Research Service report, which can help
these organizations in their fundraising and other advocacy efforts.

When the nation’s largest teacher association, the National Education Associ-
ation (NEA), cites its federal charter, it lends the NEA a level of significance and
suggests an effectiveness that is not supported by evidence. In fact, the NEA and
the nation’s other large teacher union, the American Federation of Teachers (AFT),

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use litigation and other efforts to block school choice and advocate for additional
taxpayer spending in education. They also lobbied to keep schools closed during
the pandemic. All of these positions run contrary to robust research evidence
showing positive outcomes for students from education choice policies; there is
no conclusive evidence that more taxpayer spending on schools improves student
outcomes; and evidence finds that keeping schools closed to in-person learning
resulted in negative emotional and academic outcomes for students. Furthermore,
the union promotes radical racial and gender ideologies in schools that parents
oppose according to nationally representative surveys.

e Congress should rescind the National Education Association’s
congressional charter and remove the false impression that
federal taxpayers support the political activities of this special
interest group.

This move would not be unprecedented, as Congress has rescinded the federal
charters of other organizations over the past century. The NEA is a demonstrably
radical special interest group that overwhelmingly supports left-of-center policies
and policymakers.

e Members should conduct hearings to determine how much federal
taxpayer money the NEA has used for radical causes favoring a single
political party.

Parental Rights in Education and Safeguarding Students

e Federal officials should protect educators and students in
jurisdictions under federal control from racial discrimination by
reinforcing the Civil Rights Act of 1964 and prohibiting compelled
speech. Specifically, no teacher or student in Washington, D.C., public
schools, Bureau of Indian Education schools, or Department of Defense
schools should be compelled to believe, profess, or adhere to any idea, but
especially ideas that violate state and federal civil rights laws.

By its very design, critical race theory has an “applied” dimension, as its found-
ers state in their essays that define the theory. Those who subscribe to the theory
believe that racism (in this case, treating individuals differently based on race) is
appropriate—necessary, even—making the theory more than merely an analyti-
cal tool to describe race in public and private life. The theory disrupts America’s
Founding ideals of freedom and opportunity. So, when critical race theory is used
as part of school activities such as mandatory affinity groups, teacher training
programs in which educators are required to confess their privilege, or school

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assignments in which students must defend the false idea that America is sys-
temically racist, the theory is actively disrupting the values that hold communities
together such as equality under the law and colorblindness.

e Assuch, lawmakers should design legislation that prevents the theory
from spreading discrimination.

e For K-12 systems under their jurisdiction, federal lawmakers should
adopt proposals that say no individual should receive punishment or
benefits based on the color of their skin.

e Furthermore, school officials should not require students or teachers
to believe that individuals are guilty or responsible for the actions of
others based on race or ethnicity.

Educators should not be forced to discuss contemporary political issues but
neither should they refrain from discussing certain subjects in an attempt to pro-
tect students from ideas with which they disagree. Proposals such as this should
result in robust classroom discussions, not censorship. At the state level, states
should require schools to post classroom materials online to provide maximum
transparency to parents.

e Again, specifically for K-12 systems under federal authority,
Congress and the next Administration should support existing state
and federal civil rights laws and add to such laws a prohibition on
compelled speech.

Advancing Legal Protections for Parental Rights in Education

While the U.S. Supreme Court and other federal courts have consistently rec-
ognized that parents have the right and duty to direct the care and upbringing of
their children, they have not always treated parental rights as co-equal to other
fundamental rights—like free speech or the free exercise of religion. As a result,
some courts treat parental rights as a “second-tier” right and do not properly safe-
guard these rights against government infringement. The courts vary greatly over
which species of constitutional review (rational basis, intermediate scrutiny, and
strict scrutiny) to apply to parental rights cases.

This uncertainty has emboldened federal agencies to promote rules and poli-
cies that infringe parental rights. For example, under the Biden Administration’s
proposed Title IX regulations, schools could be required to assist a child witha
social or medical gender transition without parental consent or to withhold infor-
mation from parents about a child’s social transition (e.g., changing their names or

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pronouns). The federal government could demand that schools include curriculum
or lessons regarding critical race or gender theory in a way that violates parental
rights, especially if it requires minors to disclose information about their religious
beliefs, or beliefs about race or gender in violation of the Protection of Pupil Rights
Amendment (20 USC Sec. 1232h).

To remedy the lack of clear and robust protection for parental rights, the next
Administration should:

e Work to pass a federal Parents’ Bill of Rights that restores parental
rights to a “top-tier” right. Such legislation would give families a fair
hearing in court when the federal government enforces any policy against
parents in a way that undermines their right and responsibility to raise,
educate, and care for their children. The law would require the government
to satisfy “strict scrutiny”—the highest standard of judicial review—when
the government infringes parental rights.

e Further ensure that any regulations that could impact parental
rights contain similar protections and require federal agencies to
demonstrate that their action meets strict scrutiny before a final rule
is promulgated.

At the same time, Congress should also consider equipping parents with a
private right of action. Two federal laws provide certain privacy protections for
students attending educational institutions or programs funded by the department.
The Family Educational Rights and Privacy Act (FERPA) protects the privacy of
student education records and allows parents and students over the age of 18 to
inspect and review the student’s education records maintained by the school and
to request corrections to those records. FERPA also authorizes a number of excep-
tions to this records privacy protection that allow schools to disclose the student’s
education records without the consent or knowledge of the parent or student. The
Protection of Pupil Rights Amendment (PPRA) requires schools to obtain paren-
tal consent before asking questions, including surveys, about political affiliations
or beliefs; mental or psychological issues; sexual behaviors or attitudes; critical
appraisals of family members; illegal or self-incriminating behavior; religious prac-
tices or beliefs; privileged relationships, as with doctors and clergy; and family
income, unless for program eligibility.

The difficulty for parents is that FERPA and PPRA do not authorize a private
right of action. Ifa school refuses to comply with either statute, the only remedy is
for the parent or student (if over the age of 18) to file an administrative complaint
with the U.S. Department of Education, which must then work with the school
to obtain compliance before taking any action to suspend or terminate federal

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financial assistance. Investigations can take months if not years. The department
has never suspended or terminated the funding for an educational institution or
agency for violating FERPA or PPRA. In essence, Congress has granted parents
and students important statutory rights without an effective remedy to assert
those rights.

e The next Administration should work with Congress to amend
FERPA and PPRA to provide parents and students over the age of 18
years with a private right of action to seek injunctive and declaratory
relief, together with attorneys’ fees and costs if a prevailing party,
against educational institutions and agencies that violate rights
enshrined in these statutes. This will empower parents and students,
level the playing field between families and education bureaucracies, and
encourage institutional compliance with these statutory requirements.

Protect Parental Rights in Policy
In addition to strengthening legal protections for parents, the next Adminis-
tration should:

e Prioritize legislation advancing such rights. Promising ideas have
appeared in bills introduced in the 117th Congress such as H.R.8767, the
Empowering Parents Act, sponsored by Representative Bob Good (R-VA);
H.R. 6056, the Parents’ Bill of Rights Act,’ sponsored by Representative
Julia Letlow (R-LA); and H.J.Res. 99,” proposing an amendment to the
Constitution relating to parental rights, sponsored by Representative
Debbie Lesko (R-AZ).

e These congressional actions should be carefully reviewed to make
sure they complement state Parents’ Bills of Rights, such as those
passed in Georgia (2022), Florida (2021), Montana (2021), Wyoming
(2017), Idaho (2015), Oklahoma (2014), Virginia (2013), and
Arizona (2010).

As documented by writers such as Abigail Shrier and others, the American
Society of Plastic Surgeons documented a four-fold increase in the number of
biological girls seeking gender surgery between 2016 and 2017. Larger increases
were found in the U.K. from 2009 to 2019 and 2017 to 2018. These statistics and
others point to a social contagion in which minor children, especially girls, are
attempting to make life-altering decisions using puberty blockers and other hor-
mone treatments and even surgeries to remove or alter vital body parts. Heritage
Foundation research finds that providing easier access to such treatments and

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surgeries without parental involvement does not reduce the suicidality of these
young people and may even increase suicide rates.

e The next Administration should take particular note of how radical
gender ideology is having a devastating effect on school-aged children
today—especially young girls.

School officials in some states are requiring teachers and other school employ-
ees to accept a minor child’s decision to assume a different “gender” while at
school—without notifying parents. In California, New Jersey, and certain districts
in Kansas and elsewhere, educators are prohibited from informing parents about
children’s confusion over their sex if the children do not want their parents to know.
Such policies allow schools to drive a wedge between parents and children. The
next Administration should work with Congress to provide an example to state
lawmakers by requiring K-12 districts under federal jurisdiction, including Wash-
ington, D.C., public schools, Bureau of Indian Education schools, and Department
of Defense schools, with legislation stating that:

e No public education employee or contractor shall use a name to
address a student other than the name listed on a student’s birth
certificate, without the written permission of a student’s parents
or guardians.

e No public education employee or contractor shall use a pronoun
in addressing a student that is different from that student’s
biological sex without the written permission of a student’s parents
or guardians.

e No public institution may require an education employee or
contractor to use a pronoun that does not match a person’s
biological sex if contrary to the employee’s or contractor’s religious
or moral convictions.

State lawmakers should use this model and adopt similar provisions for public
schools within their borders. Federal lawmakers should not allow public school
employees to keep secrets about a child from that child’s parents.

Advance School Choice Policies

The D.C. Opportunity Scholarship Program, a voucher program providing
scholarships to children from low-income families living in the nation’s capital to
attend a private school of choice, is capped at $20 million annually and limited to

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students at or below 185 percent of the federal poverty line. The maximum schol-
arship amount is $9,401 for students in kindergarten through eighth grade and
$14,102 for students in grades nine through 12. The average scholarship amount
is around $10,000, or less than half of the current per-student funding amount in
D.C. Public Schools.

e Congress should expand eligibility to all students, regardless of
income or background, and raise the scholarship amount closer to
the funding students receive in D.C. Public Schools (spending per
student in 2020 was $22,856).

e All families should be able to take their children’s taxpayer-funded
education dollars to the education providers of their choosing—
whether it be a public school or a private school.

e Congress should additionally deregulate the program by removing
the requirement of private schools to administer the D.C. Public
Schools assessment and allowing private schools to control their
admissions processes.

Provide Education Choice for Populations
Under the Jurisdiction of Congress

The federal government oversees three school systems that Washington should
transform into examples of quality learning environments for every child in those
systems: students attending schools in Washington, D.C.; students in active-duty
military families, including students attending schools operated by the U.S. Depart-
ment of Defense; and students attending schools on tribal lands, which include
schools under the Bureau of Indian Education. In each of these systems, federal
lawmakers should allow every student the option of using an education savings
account so that parents can select different education products and services to
meet their child’s needs.

Nearly 50,000 students attended public schools in the District of Columbia in
the 2021-2022 school year. In 2022, fourth grade math students scored 11 points
lower than fourth graders in 2019, which means District children lost an entire
year of learning over the course of the pandemic. Eighth graders also lost an entire
year of learning in math.

e Federal lawmakers should offer District students the opportunity to
use education savings accounts. A portion of a child’s federal education
spending should be deposited in a private spending account that parents can
use to pay for personal tutors, education therapists, books and curricular

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materials, private school tuition, transportation and more—accounts
modeled after the accounts in Arizona, Florida, West Virginia, and seven
other states.

e Members of Congress should design the same account system
for students in active-duty military families, including students
attending schools that receive funding under the National Defense
Authorization Act (NDAA)."

Heritage Foundation research found that if even 10 percent of the students eli-
gible for accounts under such a proposal transferred from an assigned school to an
education savings account, the change for the sending district would be 0.1 percent
of that school district’s K-12 budget. Even in heavily impacted districts (districts
with a large number of students receiving Impact Aid), the budgetary effect would
be less than 2 percent. Yet these children would then have the chance to receive a
customized education that meets their unique needs. As with state ESA programs,
families who are homeschooling are distinct in statute from families who use an
ESA to customize an education at home.

Furthermore, research from the Claremont Institute used documents pro-
vided by a whistleblower demonstrating how educators at Department of Defense
schools around the world are using radical gender theory and critical race theory
in their lessons. This instructional material discards biology in favor of political
indoctrination and applies critical race theory’s core tenets advocating for more
racial discrimination. Such ideas are highly unpopular among parents, accord-
ing to nationally representative surveys, and the course material attempts to
indoctrinate students with radical ideas about race and the ambiguous concept
of “gender.”

Finally, schools on tribal lands and under the auspices of the Bureau of Indian
Education (BIE) are among the worst-performing public schools in the country.
Research from Rep. Burgess Owens’ office reports that the graduation rate for BIE
students is 53 percent, lower than the average for Native American students in
public schools around the country, and nearly 30 percentage points lower than the
national average for all students. In 2015, Arizona lawmakers expanded the state’s
education savings account program to include children living on tribal lands, and
by 2021, nearly 400 Native American children were using the accounts.

e Federal officials should design a federal education savings account
option for all children attending BIE schools.

The next Administration should make the K-12 systems under federal juris-
diction examples of quality learning opportunities and education freedom.

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Washington should convert some of the lowest-performing public school systems
in the country into areas defined by choices, creating rigorous learning options for
all children and from all backgrounds, income levels, and ethnicities.

Expand Education Choice Through Portability of Existing Federal Funds

Setting education policy on the right track long term would require sunsetting
the U.S. Department of Education altogether. Doing so would not result in fewer
resources and less assistance for children with special needs or from low-income
families. Rather, closing the federal behemoth would better target existing taxpayer
resources already set aside for these students by shifting oversight responsibilities
to federal and state agencies that have more expertise in helping these populations.

The Individuals with Disabilities Education Act (DEA) is the federal law gov-
erning taxpayer spending on K-12 students with special needs. The law stipulates
that students have a right to a “free and appropriate education,” and 95 percent of
children with special needs attend assigned public schools. The education is not
always appropriate, however: Special education is fraught with legal battles. Some
argue that the education of children with special needs is the most litigated area
of K-12 education. Thus, despite a nearly 50-year-old federal law that sees regular
revision and reauthorization and approximately $13.5 billion per year in federal
taxpayer spending, parents still struggle to establish intervention plans for their
students with public school district officials regarding the physical and educational
requirements for their children with special needs.

State-level education options often exclusively serve children with special needs
for these very reasons. Florida, Oklahoma, Tennessee, Mississippi, South Carolina,
and North Carolina, to name a few states, all have education savings accounts or
K-12 private school scholarship options for children with special needs.

e Federal lawmakers should move IDEA oversight and implementation
to the U.S. Department of Health and Human Services.

e Officials should then consider revising IDEA to require that a
child’s portion of the federal taxpayer spending under the law be
made available to families so parents can choose how and where a
child learns.

e IDEA already allows families to choose a private school under
certain conditions, but federal officials should update the law so that
families can use their child’s IDEA spending for textbooks, education
therapies, personal tutors, and other learning expenses, similar to
the way in which parents use education savings accounts in states
such as Arizona and Florida. These micro-education savings accounts

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would give the families of children with special needs approximately $1,800
per child to help meet a child’s unique learning needs.

Members of Congress and the White House should consider a similar
update to Title I of the Elementary and Secondary Education Act
(ESEA). Title I is the largest portion of federal taxpayer spending under
this federal education law, and the section provides additional taxpayer
resources to schools or groups of schools in lower income areas. Federal
taxpayers committed $16.3 billion to Title [in FY 2019, spending that is
dedicated to students in low-income areas of the U.S. Per student, this
spending amounts to more than $1,400 for a child in a large city and
approximately $1,300 for a student in a remote, rural area.”

Research finds, though, that this enormous investment has not produced positive

results for children in need. The achievement gap between children from the highest
and lowest income deciles has not improved over the past 50 years. And recent, dismal
outcomes on the National Assessment of Educational Progress showed declines for
all students, with math scores registering declines for the first time in history.

Initially, the responsibilities for administering and overseeing Title I
should be moved to HHS, along with IDEA.

Students attending schools that receive Title I spending should also
have access to micro-education savings accounts that allow families to
choose how and where their children learn according to their needs.

Parents should be allowed to use their child’s Title I resources to
help pay for private learning options including tutoring services and
curricular materials.

Over a 10-year period, the federal spending should be phased out and
states should assume decision-making control over how to provide a
quality education to children from low-income families.

Additional School Choice Options

House Republicans included school choice in their “Commitment to

America” agenda.

Though actions by state lawmakers are essential and any federal
policies should be strictly designed so they do not conflict with state
activities, Congress could consider school choice legislation such

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as the Educational Choice for Children Act. This bill would create a
federal scholarship tax credit that would incentivize donors to contribute to
nonprofit scholarship granting organizations (SGOs). Eligible families could
then use that funding from the SGOs for their children’s education expenses
including private school tuition, tutoring, and instructional materials.

ADDITIONAL K-12 REFORMS

Allowing States to Opt Out of Federal Education Programs. States should
be able to opt out of federal education programs such as the Academic Partnerships
Lead Us to Success (APLUS) Act. Much of the red tape and regulations that hinder
local school districts are handed down from Washington. This regulatory burden
far exceeds the federal government’s less than 10 percent financing share of K-12
education. In the most recent fiscal year (FY 2022), states and localities financed
93 percent of K-12 education costs, and the federal government just 7 percent.
That 7 percent share should not allow the federal government to dictate state and
local education policy.

e Torestore state and local control of education and reduce the
bureaucratic and compliance burden, Congress should allow states to
opt out of the dozens of federal K-12 education programs authorized
under the Elementary and Secondary Education Act, and instead
allow states to put their share of federal funding toward any lawful
education purpose under state law. This policy has been advanced over
the years via a proposal known as the Academic Partnerships Lead Us to
Success (APLUS) Act.

HIGHER EDUCATION REFORM

HEA: Accreditation Reform

Congress established two primary responsibilities for the U.S. Department
of Education in the HEA: J) to ensure the “administrative capacity and financial
responsibility” of colleges and universities that accept Title IV funds; and 2) to
ensure the quality of those institutions. Congress did not endow the Department
of Education with the authority to involve itself in academic quality issues relating
to colleges and universities that participate in the Title IV student aid program;
the HEA allows the agency only to recognize accreditors, which are then supposed
to provide quality assurance measures.

Unfortunately, the Biden Administration has followed closely in the footsteps
of the Obama Administration by engaging in a politically motivated and incon-
sistent administration of the accrediting agency recognition process. As a result,
accreditors have transformed into de facto government agents. Despite claims by

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the department and accreditation agencies that accreditation is voluntary, the

fact that Americans are denied access to an otherwise widely available entitle-
ment benefit if the institution “elects” to not be accredited makes accreditation
anything but voluntary. Today, accreditation determines whether Americans can
access federal student aid benefits, transfer academic credits, enroll in higher-level
degree programs, and even qualify for federal employment.

Unnecessarily focused on schools ina specific geographic region, institutional
accreditation reviews have also become wildly expensive audits by academic “peers”
that stifle innovation and discourage new institutions of higher education. Of par-
ticular concern are efforts by many accreditation agencies to leverage their Title IV
(student loans and grants) gatekeeper roles to force institutions to adopt policies
that have nothing to do with academic quality assurance and student outcomes.
One egregious example of this is the extent to which accreditors have forced col-
leges and universities, many of them faith-based institutions, to adopt diversity,
equity, and inclusion policies that conflict with federal civil rights laws, state laws,
and the institutional mission and culture of the schools. Perhaps more distress-
ingly, accreditors, while professing support for academic freedom and campus
free speech, have presided over a precipitous decline in both over the past decade.
Despite maintaining criteria that demand such policies, accreditors have done
nothing to dampen the illiberal chill that has swept across American campuses
over the past decade.

The current system is not working. A radical overhaul of the HEA’s accreditation
requirements is thus in order. The next Administration should work with Congress
to amend the HEA and should consider the following reforms:

e Prohibit accreditation agencies from leveraging their Title IV
gatekeeper role to mandate that educational institutions adopt
diversity, equity, and inclusion policies.

e Protect the sovereignty of states to decide governance and
leadership issues for their state-supported colleges and universities
by prohibiting accreditation agencies from intruding upon the
governance of state-supported educational institutions.

e Protect faith-based institutions by prohibiting accreditation
agencies from:

1. Requiring standards and criteria that undermine the religious

beliefs of, or require policies or conduct that conflict with, the
religious mission or religious beliefs of the institution; and

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2. Intruding on the governance of colleges and universities
controlled by a religious organization.

e Revamp the system for recognizing accreditation agencies for Title
IV purposes by removing the department’s monopoly on recognition
by (1) authorizing states to recognize accreditation agencies for
Title IV gatekeeping purposes and/or (2) authorizing state agencies
to act as accreditation agencies for institutions throughout the
United States.

The next Administration and Congress might also consider amending the HEA
to remove accreditors from the program triad entirely to allow accreditation
to return to its original role of voluntary quality assurance. This would permit
accreditors to put some “teeth” back into their standards without creating high-
stakes disasters, such as institutional loss of Title IV access through paperwork
submission errors, a state exercising its constitutional authority to administer its
public colleges and universities, or an institution freely exercising the religious
beliefs of its founders. With this option, neither the department nor the states
would oversee or recognize accrediting agencies. The department’s role would
be limited to evaluating the institution’s compliance with federal accounting
requirements pursuant to evaluations conducted by appropriately credentialed
auditors who have no conflicts of interest in performing the review paid for by
the federal agency charged with overseeing compliance—not the institutions
being reviewed.

HEA: Student Loans

e Beyond immediate policy moves and rulemaking to end the current
Administration’s abuse of the department’s payment pause and
HEA loan forgiveness programs, the department should work with
Congress to overhaul the federal student loan program for the benefit
of taxpayers and students.

The federal government does not have the proper incentives to make sound
lending decisions. The new Administration should consider:

e =6Privatizing all lending programs, including subsidized, unsubsidized,
and PLUS loans (both Grad and Parent). This would allow for market
prices and signals to influence educational borrowing, introducing
consumer-driven accountability into higher education. Pell grants should
retain their current voucher-like structure.

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If privatizing student lending is not feasible, then the next Administration
should consider the following reforms:

e Switch to fair-value accounting from FCRA accounting.

e Consolidate all federal loan programs into one new program that
a) utilizes income-driven repayment, b) includes no interest rate
subsidies or loan forgiveness, c) includes annual and aggregate
limits on borrowing, and d) includes skin in the game to hold
colleges accountable.

e Eliminate Grad PLUS loans (for graduate students) and Parent PLUS
loans (for parents of undergraduates).

Graduate students are already eligible for unsubsidized Stafford student loans;
Grad PLUS loans are redundant. They also lack some of the safeguards of Stafford
loans, such as annual and aggregate borrowing limits. Parent PLUS loans are also
redundant because there are many privately provided alternatives available.

e The Public Service Loan Forgiveness program, which prioritizes
government and public sector work over private sector employment,
should be terminated.

Whatever Congress chooses to do with future loans, there is still the question of
the government’s responsible stewardship of the existing student loan portfolio—a
substantial taxpayer asset. The current Administration has recklessly engaged in
the policy fetish of forgiving and canceling student loans with abandon.

e The next Administration should work with Congress to amend the
HEA to ensure that no Administration engages in this kind of abuse
in the future.

e §6Specifically, the new Administration should urge the Congress to
amend the HEA to abrogate, or substantially reduce, the power of the
Secretary to cancel, compromise, discharge, or forgive the principal
balances of Title IV student loans, as well as to modify in any material
way the repayment amounts or terms of Title IV student loans.

e Further, the next Administration should propose that Congress

amend the HEA to remove the department’s authority to forgive loans
based on borrower defense to repayment; instead, the department

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should be authorized to discharge loans only in instances where clear
and convincing evidence exists to demonstrate that an educational
institution engaged in fraud toward a borrower in connection with
his or her enrollment in the institution and the student’s educational
program or activity at the institution.

Cap indirect costs at universities. Currently, the federal government pays a por-
tion of the overhead expenses associated with university-based research. Known
as “indirect costs,” these reimbursements cross-subsidize leftist agendas and the
research of billion-dollar organizations such as Google and the Ford Foundation.
Universities also use this influx of cash to pay for Diversity, Equity, and Inclusion
(DED efforts. To correct course,

e Congress should cap the indirect cost rate paid to universities so
that it does not exceed the lowest rate a university accepts from
a private organization to fund research efforts. This market-
based reform would help reduce federal taxpayer subsidization of
leftist agendas.

NEW REGULATIONS

Attacking the Accreditation Cartel

For a college to participate in federal financial aid programs, it must be accred-
ited, but accreditors have been abusing their quasi-regulatory power to impose
non-educational requirements and ideological preferences on colleges.

e The Secretary of Education should refuse to recognize all accreditors
that abuse their power.

e Newaccreditors should also be encouraged to start up.

Confronting the Chinese Communist Party’s Influence on Higher Education

According to media reports, more than 100 universities in the U.S. received
nearly $100 billion in gifts and grants from China-based sources between 2013
and 2020. Much of this money derives from the Chinese Communist Party and
its proxies. The next Administration must

e Reverse the Biden Administration’s refusal to enforce Section
117 of the HEA, which directs colleges and universities to report
gifts from, and contracts with, sources outside the U.S. worth
$250,000 or more.

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e Investigate postsecondary institutions that fail to honor their
Section 117 obligations and make appropriate referrals to DOJ.

e Work with Congress to amend the HEA to tie the HEA’s foreign
source reporting requirements to an institution’s ability to receive
federal financial assistance, particularly participation in programs
funded under Titles IV and VI of the HEA.

Allowing Competency-Based Education to Flourish

Competency-based education is a promising approach that could provide
a high-quality and affordable education to many students. Since the credit
hour, which measures the time in the classroom, is inappropriate for such
programs, the direct assessment method was introduced to allow competen-
cy-based programs to participate in the federal financial aid programs. However,
overregulation has hampered the usage of direct assessment, with the lead-
ing competency-based university choosing to instead convert their courses
into credit hours for compliance purposes. One of the leading obstacles is the
requirement that courses include “regular and substantive” interaction between
faculty and students.

e Newregulations should clarify the definition and requirements of
regular and substantive interaction for competency-based education,
as well as for online programs.

Reforming “Area Studies” Funding

e Congress should wind down so-called “area studies” programs at
universities (Title VI of the HEA), which, although intended to serve
American interests, sometimes fund programs that run counter to
those interests.

e Inthe meantime, the next Administration should promulgate
a new regulation to require the Secretary of Education to
allocate at least 40 percent of funding to international business
programs that teach about free markets and economics and
require institutions, faculty, and fellowship recipients to certify
that they intend to further the stated statutory goals of serving
American interests.

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NEW EXECUTIVE ORDERS THAT THE PRESIDENT SHOULD ISSUE

Guidance Documents

e The President should immediately reinstate and reissue Executive
Order 13891: Promoting the Rule of Law Through Improved
Agency Guidance Documents, 84 Fed. Reg. 55235 (Oct. 9, 2019),
and Executive Order 13892: Promoting the Rule of Law Through
Transparency and Fairness in Civil Administrative Enforcement and
Adjudication (Oct. 15, 2019).

These executive orders required all federal agencies to treat guidance documents
as non-binding in law and practice and also forbade federal agencies from imposing
new standards of conduct on persons outside the executive branch through guid-
ance documents. They required all federal agencies to apply regulations and statutes
instead of guidance documents in any enforcement action. President Biden revoked
these executive orders on January 20, 2021, demonstrating that these executive
orders effectively restrained the abuses of an expansive administrative state.

e Require APA notice and comment. The President should issue an
executive order requiring the Office for Civil Rights’ Case Processing
Manual to go through APA (Administrative Procedures Act) notice
and comment.

e Protect the First Amendment. The President should issue an
executive order requiring grant applications (SF-424 series) to contain
assurances that the applicant will uphold the First Amendment in funded
programs and work.

e Minimize bachelor’s degree requirements. The President should issue
an executive order stating that a college degree shall not be required for any
federal job unless the requirements of the job specifically demand it.

e = ©Eliminate the “list of shame.” Educational institutions can claim a
religious exemption with the Office for Civil Rights at the Department
of Education from the strictures of Title IX. In 2016, the Obama
Administration published on the Department of Education’s website a
list of colleges that had applied for the exemption. This “list of shame” of
faith-based colleges, as it came to be known, has since been archived on ED’s
website, still publicly available. The President should issue an executive
order removing the archived list and preventing such a list from being
published in the future.

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NEW AGENCY POLICIES THAT DON’T REQUIRE NEW
LEGISLATION OR REGULATIONS TO ENACT

Transparency of FERPA and PPRA Complaints

e The Department of Education should be transparent about
complaints filed on behalf of families regarding the Family
Educational Rights and Privacy Act (FERPA) and the Protection of
Pupil Rights Amendment (PPRA).

e Atthe same time, the Department of Education should develop
a portal and resources for parents on their rights under FERPA
and PPRA. This portal should also contain an explanation of the Health
Insurance Portability and Accountability Act (HIPPA) and public school
procedures to demonstrate that the law does not deprive parents of their
right to access any school health records.

The D.C. Opportunity Scholarship Program

In 2011, Congress added new requirements to the D.C. Opportunity Scholarship
Program stating that participating private schools must submit to site visits by the
program administrator, inform prospective students about the school’s accreditation
status, mandate that teachers of core subjects have bachelor’s degrees, and require
participating students to take some form of nationally norm-referenced test. Notably,
the 2011 reauthorization also required, for the first time, that participating private
schools be accredited or be on a path to accreditation. The 2017 reauthorization went
further, requiring that each participating school supply a certificate of accreditation
to the administering entity upon program entry, demonstrating that the school is
fully accredited before being allowed to participate. The list of approved accreditors
is entirely too small to serve the mission of the diverse schools in the nation’s capital.

e Although the accreditation regulations should be removed entirely
by Congress, in the meantime, the next President should issue an

executive order expanding the list of allowable accreditors.

Transparency Around Program Performance and DEI Influence
The next President should issue a series of executive orders requiring:

e An accounting of how federal programs/grants spread DEI/CRT/
gender ideology,

e Areview of outcomes for GEAR UP and the 21st Century
grants programs,

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e The reissuing of the report on school safety from 2018 with updated
information,

e Therelease of a report to Congress on how to consolidate the
department and trim nonessential employees,

e Areport on the negative influence of action civics on students’
understanding of history and civics and their disposition toward the
United States,

e An update of the Coleman report to show the impact of family
structure on student achievement,

e ©6A full accounting of CARES Act education expenditures, and

e Areport on how many dollars make their way to the classroom in
every federal education grant and program.

Pursue Antitrust Against Accreditors

e The President should issue an executive order pursuing antitrust
against college accreditors, especially the American Bar
Association (ABA).

NEW POLICIES/REGULATIONS THAT REQUIRE COORDINATION
WITH OTHER AGENCIES AND/OR THE WHITE HOUSE

The department must coordinate any rulemaking with the White House, the
Office of Management and Budget (OMB), DOJ, and other agencies that share
responsibility with the department in the administration or enforcement of stat-
ute, such as Titles VI and IX. Moreover, regarding regulations arising under civil
rights laws administered by the department, Executive Order 12550 requires the
Attorney General to approve final regulations; the Assistant Attorney General for
Civil Rights must approve notices of proposed rulemaking.

Organizational Issues

Historical Budget Information. Congressional appropriations for the U.S.
Department of Education have risen from $14 billion in 1980 to $95.5 billion in
2021, an astounding increase, especially in light of the lack of improvements in
student outcomes.

Recommend Budget Cuts, Shifts, and Augmentations, If Any. Transferring
most of the programs at the U.S. Department of Education to other agencies and
eliminating duplicative and ineffective programs would yield significant taxpayer

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Mandate for Leadership: The Conservative Promise

CHART 4
U.S. Department of Education, Total Appropriations

IN BILLIONS OF DOLLARS
$120

$100 $95.5
$80
$60
$40

$20 $14

$0
1980 1985 1990 1995 2000 2005 2010 2015 2020

NOTE: Totals include mandatory and discretionary appropriations.
SOURCE: U.S. Department of Education, “Budget History Tables,” Education Department Budget History Table,
httos://www2.ed.gov/about/overview/budget/history/index.html (accessed March 17, 2023).

@ heritage.org

savings. The proposal would immediately save more than $17 billion annually in
various programs. Savings over a decade would be far more robust, as the revenue
responsibility for many formula grant programs would be returned to the states.
Some highlights include:

e Eliminate competitive grant programs and reduce spending on
formula grant programs. Competitive grant programs operated by the
Department of Education should be eliminated, and federal spending
should be reduced to reflect remaining formula grant programs authorized
under Title I of the Elementary and Secondary Education Act (ESEA)
and the handful of other programs that do not fall under the competitive/
project grant category. Remaining programs managed by the Department

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2025 Presidential Transition Project

of Education, such as large formula grant programs for K-12 education,
should be reduced by 10 percent. This would cut approximately 29 programs,
most of which are discretionary spending. In total, this would generate
approximately $8.8 billion in savings.

e Eliminate the PLUS loan program. As mentioned above, the PLUS loan
program, which provides graduate student loans and loans to the parents
of undergraduate students, should be eliminated. This would generate an
estimated $2.3 billion in savings.

e End time-based and occupation-based student loan forgiveness. A low
estimate suggests ending current student loan forgiveness schemes would
save taxpayers $370 billion.

e Eliminate GEAR-UP. It is not the responsibility of the federal government
to provide taxpayer dollars to create a pipeline from high school to college.
GEAR UP should be eliminated, and its functions should instead be handled
privately or at the state and local levels, where policymakers are better
equipped to increase college preparedness within their school districts.

Personnel

The Department of Education currently employs approximately 4,400 indi-
viduals. As programs are eliminated or transferred to other agencies, those
employees whose positions are determined to be essential to the mission would
move with their constituent programs. Current salaries and expenses at ED total
$2.2 billion annually.

AUTHOR’S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but
Jonathan Butcher, Bob Eitel, Jim Blew, Diane Auer Jones, Erin Valdez, Andrew Gillen, and Max Eden deserve special
mention. The author alone assumes responsibility for the content of this chapter, and no views expressed herein
should be attributed to any other individual.

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Mandate for Leadership: The Conservative Promise

93-112.
Act, Public Law 94-142.

S. 510, Department of Education Organization Act, Public Law 96
Ambassador Susan Rice, Gene Sperling, and Clarence Wardell III, Advancing Equity through the American

jhtml#:~:text=ED's%20mission%20is%20to%20promote,offices

ehouse.gov/wp-con
.odf (accessed February 28, 2023).
on Statement, https://www2.ed.gov/about/landing.

%20from%20several%20federal%20agencies

ins IV, Public Law 109-270.

-88.

Education at a Crossroads: What Works and What's Wasted in Education Today, Subcom

Academic Achievement of the Disadvantaged) and Section 20 U
e Secretary is authorized to waive the requiremen
rulemaking if he or she “determines that applying such a require

he APA]), and publishes the basis for such determination in th

and Investigations, Committee on Education and the Workforce,

§ 6301 et seq. (2015).
the Elementary and Secon

y to the public interest (wi

U.S. House of Represen

dary Education Act (lm

S.C. 81022F; 20 U.S.C. 8

ilton Friedman, The Role of Government in Education (1955), https://la.utexas.edu/users/
hcleaver/330T/350kPEEFriedmanRoleOfGovttable.pdf (accessed February 28, 2023).
Elementary and Secondary Education Act of 1965, Public Law 89-10.

ent/uploads/2022/05/ADVANCING-

Jonathan Butcher, “Who Signs Your Paycheck?” Education Next, https:/Awww.educationnext.org/who-signs-
your-paycheck-federal-influence-state-education-agencies/#_ednil (last updated, April

9, 2018).
mittee on Oversight
tatives, 105th Cong.,

proving the
098a. Under Title
for negotiated

ment with respect to given regulations is

hin the meaning of sec

irst published.” 20 U.S.C. §

ENDNOTES
i:
2.
3. — Higher Education Act of 1965, Public Law 89-329.
4. Elementary and Secondary Schools Emergency Relief Funds.
5. — Rehabilitation Act of 1973, Public Law
6. — Individuals with Disabilities Education
7. Perkins Career and Technical Education Acts, Perk
8.
9.
Rescue Plan, pg. 26. May 2022, at https://www.whi
EQUITY-THROUGH-THE-AMERICAN-RESCUE-PLA
10. U.S. Department of Education, Overview and Missi
(accessed February 28, 2023).
Ti.
12.
2nd Sess., July 17, 1998, pp. xiii and xiv.
13. Every Student Succeeds Act, 20 U.S.C.
14. 20 U.S.C. $6571. Under subchapter | 0
20, Section 1098a, of the U.S. Code, th
impracticable, unnecessary, or contra
proposed regulations in question are
“Negotiated Rulemaking: In Brief” Apr
(accessed March 13, 2023).
15. H.R. 8767, Empowering Parents Act, 117th Congress.
16. H.R. 5, Parents Bill of Rights Act.
17. HJ.Res. 99, Public Law 115-30.
18. National Defense Authorization Act for Fiscal Year 2022.
19.

(accessed February 28, 2023).

— 362 —

ion 553(b)(3)(B) of

e Federal Register at the same time as the

098a(b)(2). Congressional Research Service,

il 12, 2021, https://crsreports.congress.gov/product/pdf/R/R46756

ational Center for Education Statistics, “Fast Facts: Title |,” https://nces.ed.gov/fastfacts/display.asp?id=158

DEPARTMENT OF ENERGY
AND RELATED COMMISSIONS

Bernard L. McNamee

AMERICAN ENERGY AND SCIENCE DOMINANCE

The next conservative Administration should prioritize energy and science
dominance to ensure that Americans have abundant, affordable, and reliable
energy; create good-paying jobs; support domestic manufacturing and technology
leadership; and strengthen national security. Achieving these goals will require
bold policy action and reforms that involve the U.S. Department of Energy (DOE);
the Federal Energy Regulatory Commission (FERC); and the Nuclear Regulatory
Commission (NRC).

American Energy Dominance. Access to affordable, reliable, and abundant
energy is vital to America’s economy, national security, and quality of life. Yet
ideologically driven government policies have thrust the United States into anew
energy crisis just a few short years after America’s energy renaissance, which began
in the first decade of the 2000s, transformed the United States from a net energy
importer (oil and natural gas) to energy independence and then energy dominance.
Americans now face energy scarcity, an electric grid that is less reliable, and arti-
ficial shortages of natural gas and oil despite massive reserves within the United
States—all of which has led to higher prices that burden both the American people
and the economy.

The new energy crisis is caused not by a lack of resources, but by extreme “green”
policies. Under the rubrics of “combating climate change” and “ESG” (environmen-
tal, social, and governance), the Biden Administration, Congress, and various states,
as well as Wall Street investors, international corporations, and progressive spe-
cial-interest groups, are changing America’s energy landscape. These ideologically

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Mandate for Leadership: The Conservative Promise

driven policies are also directing huge amounts of money to favored interests and
making America dependent on adversaries like China for energy. In the name of
combating climate change, policies have been used to create an artificial energy
scarcity that will require trillions of dollars in new investment, supported with
taxpayer subsidies, to address a “problem” that government and special interests
themselves created. The result has been increased energy costs that:

e Hurt individuals and families, especially low-income Americans and seniors
on fixed incomes;

e Make businesses that create the jobs that drive our economy and quality of
life less competitive; and

e Make America less energy secure.

Moreover, increased energy scarcity will allow government, either directly
or through access to banks and Wall Street investors, to decide who is “worthy”
to receive funding for energy projects. In the end, government control of energy
is control of people and the economy. This is one reason why the trend toward
nationalization of our energy industry through government mandates, bans on
the production and use of oil and natural gas, and nationalization of the electric
grid is so dangerous.

At the same time, adversaries like China, Russia, North Korea, Iran, and
non-state actors are constantly engaged in cyberattacks against our energy infra-
structure. We have already seen what supposedly “minor” attacks, such as the
cyberattack on the Colonial Oil Pipeline’ or the physical attack on electric infra-
structure in North Carolina,’ can do. A coordinated cyber and physical attack on
natural gas pipelines and the electric grid during an extended cold spell could be
catastrophic. Yet the current Administration’s first concern is plowing taxpayer
dollars into intermittent wind and solar projects and ending the use of reliable
fossil fuels.

A conservative President must be committed to unleashing all of America’s
energy resources and making the energy economy serve the American people, not
special interests. This means that the next conservative Administration should:

e Promote American energy security by ensuring access to abundant, reliable,
and affordable energy.

e = Affirm an “all of the above” energy policy through which the best attributes
of every resource can be harnessed for the benefit of the American people.

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2025 Presidential Transition Project

e Support repeal of massive spending bills like the Infrastructure Investment
and Jobs Act (IIJA)? and Inflation Reduction Act (IRA),* which established
new programs and are providing hundreds of billions of dollars in subsidies
to renewable energy developers, their investors, and special interests, and
support the rescinding of all funds not already spent by these programs.

e Unleash private-sector energy innovation by ending government
interference in energy decisions.

e Stop the war on oil and natural gas.

e Allow individuals, families, and business to use the energy resources they
want to use and that will best serve their needs.

e Secure and protect energy infrastructure from cyber and physical attacks.

e Refocus the Department of Energy on energy security, accelerated
remediation, and advanced science.

e Promote U.S. energy resources as a means to assist our allies and diminish
our strategic adversaries.

e Refocus FERC on ensuring that customers have affordable and reliable
electricity, natural gas, and oil and no longer allow it to favor special
interests and progressive causes.

e Ensure that the Nuclear Regulatory Commission facilitates rather than
hampers private-sector nuclear energy innovation and deployment.

American Science Dominance. Ever since the age of Benjamin Franklin, the
United States has been at the forefront of scientific discovery and technological
advancement. Beginning with the groundbreaking science of the Manhattan Proj-
ect, the U.S. has developed 17 National Laboratories that conduct fundamental and
advanced scientific research. The National Labs have been critical in supporting
national defense and ensuring that the United States leads on scientific discoveries
with transformative applications that benefit America and the world.

In recent years, however, U.S. science has been under threat. Externally,
adversaries like the Chinese military have been engaged in scientific espionage,
infiltrating taxpayer-funded scientific research projects, and funding their own
science research. In addition, the National Labs have been too focused on climate
change and renewable technologies.

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Mandate for Leadership: The Conservative Promise

American science dominance is critical to U.S. national security and economic
strength. The next conservative President therefore needs to recommit the United
States to ensuring this dominance.

MISSION STATEMENT FOR A REFORMED DEPARTMENT OF ENERGY

The Department of Energy should be renamed and refocused as the Department
of Energy Security and Advanced Science (DESAS). DESAS would refocus on DOE’s
five existing core missions:

e Providing leadership and coordination on energy security and related
national security issues,

e Promoting U.S. energy economic interests abroad,

e Leading the nation and the world in cutting-edge fundamental
advanced science,

e Remediating former Manhattan Project and Cold War nuclear
material sites, and

e Developing new nuclear weapons and naval nuclear reactors.

These missions work together by using advanced science to promote national
security while getting the government out of the business of picking winners and
losers in energy resources. Reform is needed because DOE, instead of focusing on
core energy and security issues, has been spending billions of taxpayer dollars to
subsidize renewable energy developers and investors, thereby making Americans
less energy secure and distorting energy markets.

OVERVIEW

DOE was created by the Department of Energy Organization Act of 19775 in
response to the 1970s oil crisis, consolidating various energy programs that pre-
viously had operated without coordination throughout the federal government in
a single department. In addition to addressing energy issues, DOE is tasked with:

e Engaging in basic and fundamental science and research through the 17
National Laboratories;

e Cleaning up the Manhattan Project and Cold War nuclear material and
weapons sites;

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2025 Presidential Transition Project

e Developing sites for the storing of civilian nuclear waste; and

e Developing new nuclear weapons and naval reactors through the
semiautonomous National Nuclear Security Agency (NNSA).

Beyond these core responsibilities, DOE currently administers billions of
dollars that support research and commercialization of energy technology,
provides loans to the private sector for energy infrastructure and technology
commercialization, and issues energy efficiency standards for appliances. More
recently, DOE has focused its work and taxpayers’ money on renewable energy
and climate change.°

It is one thing for government to engage in fundamental scientific research
that the private sector would not perform, particularly because advancements in
science promote national security through technological prowess. Government,
however, should not be picking winners and losers in dealing with energy resources
or commercial technology. Such government favoritism can crowd out new innova-
tion, devolve into cronyism, and raise energy prices for consumers and businesses.
It is time for the United States to use all of its energy resources again for the benefit
of the American people.

New Policies: Energy
To ensure that the American people have access to abundant, affordable, and
reliable energy, DESAS’s energy role should be focused on:

e Working with the energy industry and networks to ensure energy
infrastructure security through science and coordination with the
private sector.

e Assessing international energy issues that constitute threats to U.S.
national security.

e Promoting U.S. energy resources as a means to assist our allies, diminish our
strategic adversaries, and ensure the existence of markets that will support

domestic energy production.

e Pursuing early and advanced science, including materials science, that is
related to energy and national security.

e Developing the leadership necessary for the disposal of commercial and
government spent nuclear fuel.

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Mandate for Leadership: The Conservative Promise

National Energy Security. Protecting American infrastructure from cyber
and physical threats, both natural and human, is vital to national security, the
economy, and the well-being of the American people. Protecting and advanc-
ing these national security interests is a proper role for the federal government.
DESAS should:

e Focus on studying threats to the electric grid, natural gas, and oil
infrastructure; sharing such information with the energy industry;
promoting the reliability and security of energy resources and
infrastructure; and developing strategies and technologies to combat
threats by working with the National Labs. The following offices would
report to the DESAS Undersecretary of Energy Security:

1. Office of Cybersecurity, Energy Security, and Emergency Response
(CESER), elevated to an Assistant Secretary. CESER would work with
the existing or reconstituted versions (as described in more detail
below) of the Office of Electricity (OE); Office of Nuclear Energy (NE);
Office of Fossil Energy (FE), currently the Office of Fossil Energy
and Carbon Management (FECM); Office of Energy Efficiency and
Renewable Energy (EERE); and the Strategic Petroleum Reserve (SPR)
to identify and address threats to energy infrastructure.’ Instead of
trying to decarbonize the American economy and allocating taxpayer
dollars for commercialization of energy technologies, these offices
would focus on energy security by identifying threats to energy supplies
and infrastructure, developing strategies to address those threats, and
funding fundamental science and technology where appropriate.

2. Office of Electricity (Assistant Secretary).
3. Office of Nuclear Energy (Assistant Secretary).

4. Office of Fossil Energy (Assistant Secretary, with Carbon Management
deleted from its title and purpose.

5. Office of Energy Efficiency and Renewable Energy (Assistant Secretary).
6. Strategic Petroleum Reserve (stand-alone or part of CESER).
e Eliminate special-interest funding programs. Many DOE energy

funding programs are not targeted on fundamental science and technology;
instead, they focus more on commercialization and act as subsidies to the

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2025 Presidential Transition Project

private sector for government-favored resources. The DOE Office of Clean
Energy Demonstrations (OCED); Office of State and Community Energy
Programs; ARPA-E; Office of Grid Deployment (OGD); and DOE Loan
Program should be eliminated or reformed. If they continue to exist, FECM,
NE, OE, and EERE should focus on fundamental science and technology
issues, particularly in relation to cyber and physical threats to energy
security, rather than subsidizing and commercializing energy resources.

Eliminate political and climate-change interference in DOE
approvals of liquefied natural gas (LNG) exports. In addition, Congress
should reform the Natural Gas Act® to expand required approvals from
merely nations with free trade agreements to all of our allies, such as

NATO countries.

Focus the Federal Energy Management Program (FEMP) on ensuring
that government buildings and operations have reliable and cost-
effective energy. FEMP should stop using taxpayer dollars to force the
purchase of more expensive and less reliable energy resources in the name
of combating climate change.

Ensure that information provided by the U.S. Energy Information
Agency (EIA), a data and statistical organization, is data-neutral.

Focus FERC on its statutory obligation to ensure access to reliable
energy at just, reasonable, and nondiscriminatory rates. FERC is a
five-member commission created under the DOE Organization Act that
regulates the wholesale sales and transmission of electricity, promotes
electric reliability through standards, permits natural gas pipelines and
LNG export facilities, sets natural gas pipeline shipping rates, and sets oil
pipeline shipping rates. It is an economic regulator and should not make
itself a climate regulator.

Streamline the nuclear regulatory requirements and licensing
process. Such changes would help to lower costs and accelerate the
development and deployment of civilian nuclear, such as advanced

nuclear reactors (including small modular nuclear reactors). The Nuclear
Regulatory Commission (NRC) is commission tasked with the licensing

of civilian nuclear reactors and power plants and regulating other uses of
nuclear materials, such as nuclear medicine. Although it is not a DOE agency,
its jurisdiction over nuclear reactor, fuel, safety, and trade issues often
relates to or impinges on DOE’s jurisdiction.

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Mandate for Leadership: The Conservative Promise

e Focus on energy and science issues, not politicized social programs.
The next Administration should stop using energy policy to advance
politicized social agendas. Programs that sound innocuous, such as “energy
justice,” Justice40,” and DEI," can be transformed to promote politicized
agendas. DOE should focus on providing all Americans with access to
abundant, affordable, reliable, and secure energy, and DOE should manage
its employees so that everyone is treated fairly based on his or her talent,
skills, and hard work.

New Policies: International Energy Security

To help the President and policymakers understand and apply U.S. energy inter-
ests in international affairs more effectively, various DOE programs offices need
to be reformed.

e Promote American energy interests. The next Administration should make
U.S. energy dominance a key component of its foreign policy while ensuring
that domestic and international goals are aligned. American energy dominance
will allow the United States to secure energy for its citizens, markets for its
energy exports, and access to new energy natural resources and will provide
tools for U.S. policymakers to assist our allies and deter our adversaries. DESAS
should analyze U.S. international energy security interests and develop a
National Energy Security Strategy (NESS). This strategy would take account
of the energy landscape across the globe to inform the President in his foreign
policy and defense roles, but it should not be a tool for U.S. industrial policy,
although it might highlight how current domestic industrial and climate
policies threaten U.S. energy and national security.

e Strengthen the role of the new Department of Energy Security and
Advanced Science. There are frequent turf battles on energy issues between
the Department of State and DOE. Although the State Department clearly has
the policymaking authority under the DOE Organization Act, it tends to ignore
the expertise and perspectives that DOE provides. The existing Assistant
Secretary for International Affairs should provide the principal support for
the DOE Secretary and Deputy Secretary on National Security Council (NSC)
activities and should interface with colleagues at the Departments of Defense,
State, Treasury, and Commerce, as well as the Intelligence Community (IC).

New Policies: Advanced Science

To ensure that America continues to lead the world in fundamental science, the
National Labs should be refocused, and national science policy should be reviewed
and coordinated.

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2025 Presidential Transition Project

e Refocus the National Labs on fundamental and advanced science.
DOE currently oversees 17 National Laboratories. The three National Labs
run by DOE’s NNSA should continue to focus on national security issues.
The remaining 14 science and energy labs should focus on basic research
projects; demonstration and deployment of technology should be left to
the private sector. This goal can be achieved by realigning the labs to limit
duplication and mission creep and to maximize potential.

e Conduct a whole-of-government assessment and consolidation of
science. Before the start of anew Administration, there should be a review of
all the federal science agencies.” This should include a review of the ill-advised
attempt to expand the National Science Foundation’s mission from supporting
university research to supporting an all-encompassing technology transition.
Specific to DOE, there should be a review to measure, prioritize, and consolidate
DOE programs based on a range of beneficial factors, including degree of
relationship to national security; furtherance of energy security (cyber but also
international aspects); and importance to scientific discovery/advancement.

New Policies: Remediation of Nuclear Weapons
Development Programs and Civilian Nuclear Waste

Cleaning up the radioactive waste produced in support of the Manhattan Project
and the Cold War at America’s nuclear development sites is a massive and com-
plicated process led by DOE’s Office of Environmental Management. Projected
liabilities and costs to be borne by America’s taxpayers, according to DOE’s FY
2023 budget request, total $887,205 billion. In addition, the federal government is
required by law to dispose of nuclear waste produced by the private sector, includ-
ing spent fuel rods from nuclear power plants. The new DESAS should:

e Continue DOE’s remediation of radioactive waste created by the
nuclear weapons projects from the Manhattan Project and Cold
War. Strong leadership focused on accelerating the cleanup, coupled with
technical and administrative innovation, will be needed to reduce the
federal government’s third largest liability.

e Develop a new approach that increases the level of private-sector
responsibility for the disposal of nuclear waste. Disposing of civilian
nuclear waste is an important national issue that requires strong scientific
study. According to an independent audit conducted by the public
accounting firm of KPMG, the Nuclear Waste Fund holds $46 billion in
payments by utilities and their ratepayers, plus interest, for a permanent
waste disposal site for spent nuclear fuel and other nuclear waste. The

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Mandate for Leadership: The Conservative Promise

licensing process for Yucca Mountain as a permanent repository for spent
nuclear fuel is on hold. Without storage sites, spent nuclear fuel remains
temporarily stored at nuclear plants. In addition to permanent storage, low-
level nuclear waste facilities are needed.

New Policies: NNSA

The U.S. nuclear arsenal needs to be updated and reinvigorated if we are to be
able to deal effectively with threats from China, Russia, and other adversaries. Asa
semi-autonomous agency, the NNSA has the primary responsibility for researching
and designing new nuclear warheads and for ensuring that the existing nuclear
arsenal is still potent. These efforts require significant funding and scientific know-
how. In addition, NNSA develops and designs nuclear propulsion reactors for the
U.S. Navy. NNSA also plays a role in preventing nuclear proliferation. With strong
leadership by the Secretary of DESAS, the next Administration should:

e Fund the design, development, and deployment of new nuclear
warheads, including the production of plutonium pits in quantity.

e Expand the U.S. Navy and develop new nuclear naval reactors to
ensure that the Navy has the nuclear propulsion it needs to secure
America’s strategic interests.

e End ineffective and counterproductive nonproliferation activities
like those involving Iran and the United Nations.

Budget

DOE's total FY 2023 budget request (which does not include IIJA, IRA, and CHIPS
and Science Act funding) was for $48,183,451,000.'° Many DOE activities are required
by various authorization and appropriations bills. To implement many of the policies
contained in these proposals, several laws will need to be amended, including the
Department of Energy Organization Act, IIJA, IRA, and possibly portions of the
CHIPS (Creating Healthy Incentives to Produce Semiconductors) and Science Act.””
Ending taxpayer subsidies will promote an “all of the above” energy policy, lead to
more energy resources, reduce costs, and save taxpayers billions of dollars.

OFFICE OF CYBERSECURITY, ENERGY SECURITY,
AND EMERGENCY RESPONSE (CESER)

Mission/Overview

CESER’s mission is to “enhance the security and resilience of U.S. critical energy
infrastructure to all hazards,” to “mitigate the impacts of disruptive events and risk

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2025 Presidential Transition Project

to the sector overall through preparedness and innovation,” and to “respond to and
facilitate recovery from energy disruptions in collaboration with other Federal

agencies, the private sector, and State, local, tribal, and territory governments.”"®

Needed Reforms

The threats to U.S. energy infrastructure are real and persistent, and CESER’s
role—working to support national security by working with the private sector to
ensure energy security—is a proper one for government. Though CESER is properly
focused on the threat to the grid from inverter-based resources like wind and solar, it
needs to focus on the entire energy system, including the interdependence between
natural gas and electric generation and cybersecurity. A good first step would be to
reinstate an iteration of the Trump Administration’s Executive Order 13920, “Secur-
ing the United States Bulk-Power System.”!? The Biden Administration also placed
the Strategic Petroleum Reserves (SPR) and DOE’s Federal Power Act 202(c) author-
ity”° under the CESER office, which should continue in the next Administration.

New Policies

CESER should be refocused to prioritize the cybersecurity, physical security,
and resilience of critical infrastructure. Through research and development, tech-
nical assistance to states and industry, and emergency exercises, CESER can make
a difference in our energy security posture.

Budget

CESER received $177 million for FY 2022 under the Energy and Water Develop-
ment and Related Agencies Appropriations Bill, 2022, and $550 million through
the Infrastructure Investment and Jobs Act.”? The FY 2023 budget request is for
$202 million.” In addition, the White House has sent a letter to Congress request-
ing additional appropriations of $500 million to modernize the SPR.”*

OFFICE OF ELECTRICITY (OE)

Mission/Overview

OE was created after the 2003 blackouts to improve grid reliability and energy
assurance.” OE works to defend and promote the reliability and resiliency of the
electric grid through power grid modeling and analytics, cyber resilience programs,
and coordination with private-sector electricity providers. It also works to identify
Defense Critical Electric Infrastructure.

Needed Reforms

e Focus more intently on grid reliability. There are significant cyber,
physical, and reliability threats to the electric grid, and it is important

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Mandate for Leadership: The Conservative Promise

that a government agency with access to national security information
develops data and plans to address threats to the grid and assist the private
sector in securing it. Although OE does not stand out as a problematic
office, additional focus and priority could be given to its original mission
of working on grid reliability and resilience. OE could be combined

with CESER (as well as what is left of the Grid Deployment Office if it is
eliminated).

e Eliminate applied programs. OE administers grant programs for things
like energy storage and the testing of grid-enhancing technologies (GETs).
These programs should be eliminated. The next Administration should work
with Congress to eliminate all DOE applied energy programs including OE
(except perhaps those related to basic science for new energy technology).

New Policies

e §=6Prioritize grid security. OE (along with CESER if they are combined)
should focus on the security of critical infrastructure equipment used
in the bulk power system as envisioned in President Trump’s May 2020
Executive Order 13920 and a related December 2020 Prohibition Order,”°
which was revoked in April 2021 by President Biden.” In addition,
CESER/OE should:

1. Focus on the interdependence of and threats to electric generation and
natural gas pipelines.

2. Continue to focus on Defense Critical Electric Infrastructure.

3. Work with FERC and the North American Electric Reliability
Corporation (NERC) to ensure that there is sufficient dispatchable
on-demand generation available to generate the electricity the grid
needs when intermittent generation like wind and solar is not available.

e End funding of programs for commercial technology and deployment.
The next Administration should work with Congress to eliminate
nonessential funding of commercial technology and deployment. These
activities can be conducted by the private sector.

Budget

OE’s FY 2021 enacted budget was $211,720,000, and DOE has requested
$297,386,000 for FY 2023.78

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OFFICE OF NUCLEAR ENERGY (NE)

Mission/Overview
The Office of Nuclear Energy’s “mission is to advance nuclear energy science
and technology to meet U.S. energy, environmental, and economic needs.” It has
five stated goals: “Enable continued operation of existing U.S. nuclear reactors,”
“Enable deployment of advanced nuclear reactors,” “Develop advanced nuclear
fuel cycles,” “Maintain U.S. leadership in nuclear energy technology,” and “Enable
a high-performing organization.””? Under the Nuclear Waste Policy Act,*° the Office
of Nuclear Energy “has also been responsible for the DOE’s statutory requirements
to collect and dispose of spent nuclear fuel...since the Obama Administration’s

dissolution of the Office of Civilian Radioactive Waste Management.”*!

Needed Reforms

NE is too influential in driving the business decisions of commercial nuclear
energy firms. Instead of focusing on a limited set of basic research and devel-
opment activities that solve foundational technical issues that apply broadly to
energy production, NE intervenes in nearly all aspects of the commercial nuclear
energy industry. Absent wholesale reforms that restructure the federal energy and
science bureaucracy to eliminate such functional energy offices, the next Admin-
istration should:

e Substantially limit NE’s size and scope.

e Adopt broader regulatory and energy policy reforms that reduce
regulatory obstacles, allow all energy sources to compete fairly in the
marketplace, and establish a predictable policy environment. This will
avoid unfair bias against the nuclear industry.

New Policies

NE should transition to a more limited scope of responsibilities that focuses on
basic research, solving broadly applicable technology challenges, and solving the
nuclear waste management issue as it relates to the development and deployment
of advanced next-generation reactors, which can include small modular reactors
(SMR). While respecting existing contractual obligations, NE should not initi-
ate any new civilian reactor demonstration and commercialization projects. NE
also should:

e Focus on overcoming technical barriers that are preventing

commercial reactor demonstration projects from moving forward.
Any activities in support of existing nuclear plants and any other projects

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Mandate for Leadership: The Conservative Promise

directed toward commercialization, including licensing support, should be
shouldered by the private sector.

e Reorganize its remaining activities into three basic lines of
responsibility: nuclear fuels across the fuel cycle, reactor technology,
and civilian radioactive waste.

Budget

The above reforms would cost substantially less than the $1,675,060,000
requested for FY 2023.*" Legislation such as the IIJA placed additional funding for
new reactor demonstration projects outside of NE. These responsibilities and their
associated funds should be moved to NE as appropriate. NE should not simply add
or subtract programs, as some programs may help to support NE’s new priorities.
The better approach would be to build a new budget and program strategy that
accounts for related DOE programs and submit a new budget request reflecting
NE’s new priorities.

OFFICE OF FOSSIL ENERGY AND CARBON MANAGEMENT (FECM)

Mission/Overview

DOE is authorized by law to increase the conversion efficiency of all forms of
fossil energy, reduce costs, improve environmental performance, and increase the
energy security of the United States.** In recent years, the Office of Fossil Energy
(FE) has been transformed from its statutory role of improving fossil energy pro-
duction to one that is focused primarily on reducing the carbon dioxide emissions
from fossil fuel extraction, transport, and combustion. This change is reflected in
the office’s new name, the Office of Fossil Energy and Carbon Management (FECM),
effective as of July 2021, and FECM’s mission: “to minimize the environmental

impacts of fossil fuels while working towards net-zero emissions.”**

Needed Reforms

e Eliminate carbon capture utilization and storage (CCUS) programs.
Despite the recent expansion of the 45Q tax credit for carbon capture
utilization and storage (CCUS) to $87 per ton, most carbon capture
technology remains economically unviable, although private-sector
innovations are on the horizon. CCUS programs should be left to the private
sector to develop.* If the office continues any CCUS research, that research
should be focused more on innovative utilization.

e Pursue the processing of critical minerals. Development of domestic
critical material sources is important for national security, as the vast

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2025 Presidential Transition Project

majority of critical materials are mined or processed (or both) in Russia and
China.* The processing of critical materials from fossil fuel waste products
(primarily coal) has shown some potential and, in view of our vast domestic
reserves of coal and abundant waste from coal mining and combustion,
should be pursued.

New Policies

Eliminate FECM. The next Administration should work with Congress to
eliminate all of DOE’s applied energy programs, including those in FECM
(with the possible exception of those that are related to basic science for
new energy technology). Taxpayer dollars should not be used to subsidize
preferred businesses and energy resources, thereby distorting the market
and undermining energy reliability.

Rename FECM (if it cannot be eliminated) under its original
designation as the Office of Fossil Energy and with its original
mission: increasing energy security and supply through fossil fuels.

Focus on energy security and supply. Absent elimination of FECM,
Congress should direct FECM appropriations toward increasing energy
security and supply. Congress has already directed these goals (including
the reduction of costs).°”

Ensure that LNG export approvals are reviewed and processed ina
timely manner. In particular:

1. Ensure that LNG export applications are reviewed and approved
expeditiously.

2. Maintain the categorical exclusion from the National Environmental
Policy Act (NEPA)** for LNG exports that was established by the Trump
Administration” or (if it is revoked by the Biden Administration)
reinstate it.

3. Work with Congress to expand automatic approvals to include allies such
as NATO as wellas nations that have free trade agreements with the US.

Strategic Petroleum Reserve (SPR). The Biden Administration moved
responsibility for the SPR to CESER. Regardless of where the responsibility
lies, the new DESAS should ensure that the SPR is maintained for national
strategic purposes and not misused for political gain.

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Mandate for Leadership: The Conservative Promise

Budget

The FY 2023 budget request for FECM was approximately $893.2 million.*”°
FECM’s requested appropriation can be compared to the more than $4.0 billion
requested for the Office of Energy Efficiency and Renewable Energy."! The disparity
in funding demonstrates how DOE’s research activities and substantial portions
of its organizational structure are now focused entirely on the reduction of CO2
emissions rather than energy access or energy security.

OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY (EERE)

Mission/Overview
The Office of Energy Efficiency and Renewable Energy traces its roots to the
Energy Policy and Conservation Act of 1975,” but most of its programs today
are rooted in the Energy Policy Act of 2005.** Under the Biden Administration,
EERE’s mission is “to accelerate the research, development, demonstration, and
deployment of technologies and solutions to equitably transition America to net-
zero greenhouse gas (GHG) emissions economy-wide by no later than 2050” and
“ensure [that] the clean energy economy benefits all Americans.”** The office is
made up of three “pillars”: energy efficiency, renewable energy, and sustainable
transportation.

Needed Reforms

e End the focus on climate change and green subsidies. Under the Biden
Administration, EERE is a conduit for taxpayer dollars to fund progressive
policies, including decarbonization of the economy and renewable
resources. EERE has focused on reducing carbon dioxide emissions to
the exclusion of other statutorily defined requirements such as energy
security and cost. For example, EERE’s five programmatic priorities
during the Biden Administration are all focused on decarbonization of the
electricity sector, the industrial sector, transportation, buildings, and the
agricultural sector.*

e Eliminate energy efficiency standards for appliances. Pursuant to
the Energy Policy and Conservation Act of 1975 as amended, the agency
is required to set and periodically tighten energy and/or water efficiency
standards for nearly all kinds of commercial and household appliances,
including air conditioners, furnaces, water heaters, stoves, clothes washers
and dryers, refrigerators, dishwashers, light bulbs, and showerheads.
Current law and regulations reduce consumer choice, drive up costs for
consumer appliances, and emphasize energy efficiency to the exclusion of
other important factors such as cycle time and reparability.

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New Policies

Eliminate EERE. The next Administration should work with Congress to
eliminate all of DOE’s applied energy programs, including those in EERE
(with the possible exception of those that are related to basic science for
new energy technology). Taxpayer dollars should not be used to subsidize
preferred businesses and energy resources, thereby distorting the market
and undermining energy reliability.

Reduce EERE funding. If EERE cannot be eliminated, then the
Administration should engage with Congress and the House and Senate
Appropriations Committees on EERE’s budget. EERE’s budget was
around $1.5 billion a year when the advances were made that led to
dramatic cost decreases in wind, solar, and battery technology. In recent
years, Congress has appropriated many billions of dollars in excess of
EERE’s normal budget (DOE requested more than $4.0 billion for FY
2023).*° It should rescind these excess monies so that DOE is not required
to spend them. If funding cannot be reduced, then it should be reallocated
to more fundamental research and less toward commercialization

and deployment.

Focus on fundamental science and research. If EERE cannot be
eliminated, then the Administration should focus on broader and

more fundamental energy research, consistent with law. The Biden
Administration is too focused on deploying technologies instead of
relying on the private sector. Moreover, under the Biden Administration,
EERE is too focused on decarbonization and not at all on the

cost of energy.

Eliminate energy efficiency standards for appliances. The next
Administration should work with Congress to modify or repeal the law
mandating energy efficiency standards. Before (or in lieu of) repealing the
law, there are steps the agency can take to refocus on the consumer by giving
full force to the provisions already in the law that serve to limit regulatory
overreach and protect against excessively stringent standards. For example,
the Trump DOE prioritized the relatively few appliance regulations that
were likely to save consumers the most energy and refrained from those
whose modest benefits are unlikely to justify the costs. It also took steps

to ensure that any new standards do not compromise product quality or
eliminate any features. These and other consumer protections are in the
statute but have often been ignored.

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Mandate for Leadership: The Conservative Promise

Budget

EERE was funded at slightly more than $2.8 billion in FY 2021, and DOE
requested slightly more than $4.0 billion for FY 2023.*’ Congress needs to rescind
the appropriated monies that EERE has not spent and begin fresh with new
appropriations.

GRID DEPLOYMENT OFFICE (GDO)

Mission/Overview

The Grid Deployment Office was established to implement parts of the Infra-
structure Investment and Jobs Act. Pursuant to the IIJA, GDO administers funds
appropriated by Congress to support transmission expansion and low/zero carbon
resources. In addition, GDO is developing studies of the electric grid to address
congestion, enhance reliability and resilience, and promote “clean” energy.*

Needed Reforms

e End grid planning and focus instead on reliability. FERC and NERC
have the primary responsibility for addressing reliability, states have the
primary authority to site and permit transmission lines, and regional
transmission organizations assist in planning regional transmission needs
for parts of the country, but Congress granted some grid planning and siting
authority to FERC and DOE through the Energy Policy Act of 2005 and
ITJA, as well as grid funding through the Inflation Reduction Act. Instead
of focusing on grid expansion for the benefit of renewable resources or
supporting low/carbon generation, GDO should be incorporated into the
reformed Office of Cybersecurity, Energy Security, and Emergency Response,
which would work to enhance the grid’s reliability and resilience. To the
extent that they remain in effect, the funding programs that GDO oversees
and administers should emphasize grid reliability, not renewables expansion.

e Consider whether to defund the civil nuclear tax credit program and
hydroelectric power efficiency and production incentives established
in the IIJA and administered through GDO. If subsidies for renewable
resources are not repealed, it may be necessary to continue subsidies for
nuclear and hydro to ensure grid reliability.

New Policies

e Eliminate GDO and assign necessary activities to the reformed
CESER. It appears that GDO’s current purpose is to promote the
integration of low/zero carbon resources onto the grid by supporting
subsidies for such resources and building new transmission facilities at

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2025 Presidential Transition Project

a cost that poses a barrier to renewable generation expansion. However,
some of the grants that it administers under the IIJA appear to be properly
focused on enhancing the reliability and security of the electric grid. They
should be reassigned to the reformed and expanded CESER.

End DOE/GD0O’s role in grid planning for the benefit of renewable
developers. Under the Energy Policy Act of 2005 and IIJA, DOE is to
perform grid congestion studies and has authority to identify National
Interest Electric Transmission Corridors (NIETC). Under the Biden
Administration, GDO is working on a National Transmission Planning
Study and is administering $2.5 billion to support “nationally significant
transmission lines, increase resilience by connecting regions of the country,
and improve access to cheaper clean energy sources.”*?

Defund most GDO programs. GDO oversees nearly $20 billion in new
appropriations created by the IIJA, including a grid modernization grant
program, the transmission facilitation program, and the civil nuclear
credit program, among others. Congress should rescind any money not
already spent.

Budget

Congress appropriated $10 million for GDO in FY 2021, and DOE has requested

$90.2 million for FY 2023.°°

OFFICE OF CLEAN ENERGY DEMONSTRATION (OCED)

Mission/Overview

The OCED was established in December 2021 to implement the ITJA. Its mis-

sion is “[to] deliver clean energy demonstration projects at scale in partnership

with the private sector to accelerate deployment, market adoption, and the equi-

table transition to a decarbonized energy system.”*!

Needed Reforms

End market distortions and stop shifting technology and
development risks to taxpayers. The OCED is distorting energy

markets and shifting the risk of new technology deployment from the
private sector to taxpayers. The IIJA provided more than $20 billion in
government subsidies to help the private sector deploy and market clean
energy and decarbonizing resources. Government should not be picking
winners and losers and should not be subsidizing the private sector to bring
resources to market.

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Mandate for Leadership: The Conservative Promise

New Policies

e Eliminate OCED. The next Administration should work with Congress
to eliminate all DOE energy demonstration programs, including those
in OCED. Taxpayer dollars should not be used to subsidize preferred
businesses and energy resources, thereby distorting the market and
undermining energy reliability.

e Refocus on resources that will support reliability. To the extent that
the various energy research and development funding authorities cannot
be repealed, funded projects should be consistent with the programmatic
goals of the next Administration. For example, the already awarded
Advanced Reactor Demonstration Program should help to move SMRs
from pilot scale to commercialization and in the process address material,
fuel, and regulatory issues that would pose deployment risk to utilities and
Wall Street.

Budget
DOE’s FY 2023 budget request includes $214 million “to initiate a new $150

million competition to support demonstrations that address integration issues of

renewable energy into the U.S. transmission and distribution grids.”*” Overall, the

9953

“$21.5 billion provided by the Bipartisan Infrastructure Law” supports several

OCED programs:

e Advanced Reactor Demonstration Projects ($2.5 billion).

e Carbon Capture Large-Scale Pilot Projects ($937 million).

e Carbon Capture Demonstration Projects Program ($2.5 billion).

e Clean Energy Demonstration Program on Current and Former Mine Land
($500 million).

e Energy Improvements in Rural or Remote Areas ($1 billion).

e Industrial Demonstrations Program ($6.3 billion).

e Long Duration Energy Storage Demonstrations ($505 million).
e Regional Clean Energy Hubs ($8 billion).

e Regional Direct Air Capture Hubs ($3.5 billion).**

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2025 Presidential Transition Project

Personnel

By drawing resources from across the DOE, the OCED has already grown to 70
personnel in six months. If OCED is eliminated, those positions can be eliminated.
If OCED is reduced, its personnel can be reduced to fit its scope.

LOAN PROGRAM OFFICE (LPO)

Mission/Overview
“LPO’s mission is to finance next-generation U.S. energy infrastructure,”
serve “as a bridge to bankability for breakthrough projects and technologies,”
and “de-risk[] them at early stages of investment so they can be developed at
commercial scale and achieve market acceptance.” The Biden Administration
directed the program to subsidize the Administration’s “net zero” energy tran-
sition away from conventional fuels by 2050 and to promote union jobs and
domestic supply chains.*°
The LPO coordinates with the U.S. Treasury Federal Financing Bank and is
organized into seven divisions: Outreach and Business Development, Origination,
Portfolio Management, Risk Management, Technical and Project Management,
Legal, and Management and Operation. Its loan programs were originally designed
as temporary programs but have since been amended and expanded. Specifically:

The IRA expanded the authority in [LPO’s] existing programs, 1703, ATVM,
and Tribal Energy Finance, by $100B. IRA also created the Energy
Infrastructure Reinvestment (EIR) Financing Program (1706) which
can support up to $250B in loan authority. The CO2 Infrastructure
Finance and Innovation Act (CIFIA)—authorized by the [bipartisan
infrastructure law], appropriates $2.1B to support approximately $25B in
flexible, low-interest loans. This new legislation will create jobs and wealth,
address environmental justice and equity priorities and strengthen our

energy security and supply chains.*’
Needed Reforms

Taxpayers should not be backing risky business ventures or politically pre-
ferred commercial enterprises. To save tax dollars and reduce current risk, the
new Administration:

e Should not back any new loans or loan guarantees.

e Should seek to sunset DOE’s loan authority through Congress and
eventually eliminate the Loan Program Office.

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Mandate for Leadership: The Conservative Promise

DOE-backed loans and loan guarantees put taxpayers at undue risk, distort
private-sector investment decisions, shift private money toward projects with
political support, and create additional barriers to entry for companies that are
outside of the government’s definition of “innovative” or for companies that choose
not to participate.

New Policies
To the extent that DOE loan programs cannot be repealed, the new Adminis-
tration should:

e Strengthen due diligence and increase transparency in DOE
loan programs.

e Limit the use of new loan or loan guarantee authority to projects
that will promote the reliability and resilience of the electric
grid and other energy infrastructure and support national
security objectives.

e Establish clear mandatory qualifications requiring applicants to
comply with the Uyghur Forced Labor Prevention Act58 and to
certify that they are not financed with any other local, state, or
federal taxpayer-backed loan, loan guarantee, or bond (such as a
state “green bank”).

ADVANCED RESEARCH PROJECTS AGENCY-ENERGY (ARPA-E)

Mission/Overview

ARPA-E was created in 2007 as part of the America Competes (Creating Oppor-
tunities to Meaningfully Promote Excellence in Technology Education) Act.°*? Its
statutory goals are “to enhance the economic and energy security of the United
States through the development of energy technologies” that reduce “imports of
energy from foreign sources;” reduce “energy-related emissions, including green-
house gases;” improve “the energy efficiency of all economic sectors;” and “ensure
that the United States maintains a technological lead in developing and deploying
advanced energy technologies.”

Some in Congress see ARPA-E as beneficial because the COMPETES Act pro-
vides it with more bureaucratic flexibility than other federal programs are allowed.
Its goals are essentially the same as those of DOE’s applied energy offices, but its
structure is different, and it is focused around individual programs instead of
around offices with longer-term agendas.

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2025 Presidential Transition Project

Needed Reforms

e Stop risking taxpayer dollars as venture capital for the private
sector. ARPA-E tends to see its mission as bringing technology from
idea to commercialization. Often called the investment trough, ARPA-E
is effectively funding projects that the private sector is unwilling to fund.
Taxpayers should not in effect be picking winners and losers—and having
their dollars at risk but not gaining the economic rewards of success.

e End duplicative efforts. Another problem is that ARPA-E’s mission is
similar to the missions of DOE’s applied energy offices. If DOE’s applied
energy offices are doing their jobs correctly, they will use Funding
Opportunities Announcements, prizes, lab calls, and other funding
mechanisms that are needed to accomplish a specific goal. In other words,
ARPA-E is at best duplicating the work done by other DOE offices.

New Policies

e Eliminate ARPA-E. The next Administration should work with Congress
to eliminate ARPA-E. The agency is unnecessary, risks taxpayer dollars,
and interferes with risk-benefit decisions that should be made by the
private sector.

Budget
Congress appropriated $427 million for ARPA-E in FY 2021, and slightly more
than $700 million has been requested for FY 2023."

FEDERAL ENERGY MANAGEMENT PROGRAM (FEMP)

Mission/Overview

The Federal Energy Management Program (FEMP) describes its mission
as working with “other federal agencies to meet energy-related goals, identify
affordable solutions, facilitate public-private partnerships, and provide energy
leadership to the country by identifying government best practices.” Congress has
created a number of energy and energy efficiency requirements and guidelines for
federal agencies, and FEMP works with those agencies to help them meet their
congressionally mandated goals.

Needed Reforms

As the world’s largest single energy consumer, the federal government should
use energy efficiently and cost-effectively—especially because the taxpayer is
paying the energy bills. The Obama Administration required the federal govern-
ment to set extrastatutory and aggressive goals regarding the use of renewable

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Mandate for Leadership: The Conservative Promise

energy. The Trump Administration took a less aggressive approach in Executive
Order 13834, which specified that “each agency shall prioritize actions that reduce
waste, cut costs, enhance the resilience of Federal infrastructure and operations,
and enable more effective accomplishment of its mission.”

New Policies

A conservative Administration should follow the language of Executive Order
13834 and direct federal agencies to “reduce waste, cut costs, enhance the resilience
of Federal infrastructure and operations, and enable more effective accomplish-
ment of its mission.” For FEMP, this means focusing on helping federal agencies
to follow the law and use energy efficiently and cost-effectively.

Budget

FEMP was funded at $40 million in FY 2022, and slightly less than $170 mil-
lion is requested for FY 2023. If it is focused on helping the federal government
to carry out its statutorily based energy goal, much less money is needed.

CLEAN ENERGY CORPS

Mission/Overview

Under the ITJA, “the Clean Energy Corps is charged with investing more than
$62 billion to deliver a more equitable clean energy future for the American peo-
ple[.]”®’ The Corps says that it will “focus on deploying next generation clean energy
technology” to “help America meet its goals of a carbon-free power sector in 2035
and a decarbonized economy in 2050.”

Needed Reforms

The Clean Energy Corps is a taxpayer-funded program to create new govern-
ment jobs for employees “who will work together to research, develop, demonstrate,
and deploy solutions to climate change.” DOE anticipates recruiting “an additional
1,000 employees using a special hiring authority included in the Bipartisan Infra-
structure Law.”® Taxpayers should not have to fund a cadre of federal employees
to promote a partisan political agenda.

New Policies
Eliminate the Clean Energy Corps by revoking funding and eliminating all posi-
tions and personnel hired under the program.

Budget

Funding for Clean Energy Corps employees is not clearly defined in the FY 2023
DOE budget request.

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2025 Presidential Transition Project

ENERGY INFORMATION ADMINISTRATION (EIA)

Mission/Overview

The U.S. Energy Information Administration “collects, analyzes, and dis-
seminates independent and impartial energy information to promote sound
policymaking, efficient markets, and public understanding of energy and its inter-
action with the economy and the environment.””°

Needed Reforms

EIA is not an inherently problematic agency and historically has provided inde-
pendent and impartial analysis. Requests for EIA analyses can be made by the
Administration or from Members of Congress or congressional committees. EIA
needs to be committed to providing unbiased forecasting and data so that poli-
cymakers, industry, and the public can have a clear understanding of our energy
resources and energy economy. Strong leadership will be needed to ensure that
data and reporting are not misused to promote a politicized “energy transition.”

New Policies

e 6Clarify levelized cost of electricity. “Levelized cost of electricity (ACOE)
refers to the estimated revenue required to build and operate a generator
over a specified cost recovery period.”” It is used in the National Energy
Modeling System (NEMS) to compare the cost of technologies to determine
which technologies are expected to be constructed in the future. Although it
is useful in comparing the costs of resources over time, LCOE can also mask
the massive amounts of capital needed to deploy new generation. Moreover,
in the case of intermittent resources such as wind and solar, LCOE does not
include the cost for backup or firming power from dispatchable resources.
EIA should ensure that its reporting provides an accurate assessment of
generation costs. The cost of backup power for when wind and solar resources
are not available should be included when comparing the technologies and
reported as a separate component in the modeling documents.

e Revise reserve margins. EIA, in conjunction with FERC, NERC, regional
transmission organizations (RTOs), and the electric industry, should
change how electric grid reserve margins are defined and calculated. In the
past, reserve margins have looked at the amount of nameplate capacity on
the grid to serve peak load plus a reserve. With the increasing number of
intermittent, nondispatchable resources like wind and solar, peak load and
reserve margins need to be reevaluated. Reserve margins need to be timed to
load changes throughout the day and consider the availability of dispatchable
on-demand resources to meet load when renewables may not be available.

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Mandate for Leadership: The Conservative Promise

Update reports on the impacts of federal financial interventions and
subsidies. EIA’s most recent report on federal financial interventions and
subsidies was issued in April 2018.” This is an important analysis because it
clearly shows the level of the federal government’s intervention in each area
of the energy system for a given fiscal year. In the past, EIA performed the
analysis pursuant to a request from Congress or the Administration. This
report should become a project that is performed annually or every other
year as part of EIA’s base program.

Ensure the objectivity of the International Energy Outlook EO).

In the past, EIA published the [EO every year. It is now published every

two years. [EO forecasts are important because the International Energy
Agency’s forecasts in its annual World Energy Outlook are becoming
unrealistic and politically oriented to push Europe’s climate goals. EIA
forecasts should be based on current laws and regulations and should not be
used to promote favored policies.

Assess the case for privatization. There are some who think that EIA
should be privatized. The cost savings to taxpayers should be considered. On
the other hand, EIA has generally demonstrated neutral data presentation
that is helpful to policymakers and the private sector.

Budget

Congress appropriated $126.8 million for EIA in FY 2021, and the FY 2023

budget request is for approximately $144.5 million.”

OFFICE OF INTERNATIONAL AFFAIRS (IA)

Mission/Overview

“The Office of International Affairs has primary responsibility for addressing

international energy issues that have a direct impact on research, development,
utilization, supply, and conservation of energy affecting the United States.” It
“focuses on enhancing global energy security through countering malign influence,

diversifying supplies, and increasing energy access” and “is committed to increas-

ing US. energy exports and trade to enhance growth.””

Needed Reforms

Expand IA’s role and focus its activities on U.S. international energy
security interests. International energy activities should be consolidated
under IA (and the Department of State’s Bureau of Energy Resources
should be eliminated) to ensure a proper understanding of domestic energy

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2025 Presidential Transition Project

policy and how it affects foreign policy, as well as the international energy
landscape and how it affects U.S. national and economic security.

Develop a strategy for identifying and accessing resources and
advancing U.S. economic interests. America has recently become a
net energy exporter, but it still imports large amounts of essential energy
resources such as oil and natural gas as well as such materials as uranium
(including yellowcake), lithium, certain rare earth minerals, and energy
generation and transmission components and technology. The United
States needs a clear understanding of its global energy and economic
interests and a strategy for protecting them.

Oppose “climate reparations.” During the November 2022 United

Nations climate conference in Egypt, the Biden Administration and other
“developed” countries agreed to provide “climate reparations” to developing

countries for the harm allegedly caused by the developed countries’

use of fossil fuel.” A reparations slush fund administered by a non-U.S.

organization provides no assurance that U.S. interests will be protected and

should not be supported in any form.

New Policies

Identify U.S. energy security interests and promote American energy
dominance. To this end, IA should work closely with the DESAS Office of
Policy on the National Energy Security Strategy.

Strengthen the new DESAS vis-a-vis the Department of State. The
State Department’s Bureau of Energy Resources has generally excluded IA
from serious discussions of international affairs to the detriment of DOE
and broader interagency policy development. In addition, DOE embassy
representatives are generally excluded from giving policy advice to senior
diplomats and are used merely as sources of information instead of being
active advocates for the Secretary’s priorities. The Secretary of Energy is

a senior member of the President’s National Security Council and should
function as such. The DOE’s Deputy Secretaries, Under Secretaries, and
Assistant Secretaries should be guaranteed representation at all Deputies
and Policy Coordination Committee meetings. In addition, senior political
and career staff should hold positions on the NSC staff equivalent to their
counterparts at State, Defense, Treasury, and the Intelligence Community
(IC). DESAS billets should replace State Department Bureau of Energy
Resources billets at the relevant posts worldwide.

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Mandate for Leadership: The Conservative Promise

e Stop “climate reparations.” The President should refuse to provide
climate reparations under an unratified treaty, and IA should encourage
other countries to reconsider their desire to provide reparations.

ARCTIC ENERGY OFFICE (AE)

Mission/Overview

AE was established during the Trump Administration to create a central office
overseeing U.S. Arctic interests in Alaska and the other Arctic nations in response
to the growing strategic sensitivity of this geographic region and the natural
resources it contains. It “serves as the principal advisor to the Under Secretary

on all domestic Arctic issues, including energy, science, and national security.””

Needed Reforms

In October 2022, the Biden Administration released its National Strategy
for the Arctic Region.”® Although recognizing national security threats in the
Artic, it also focuses heavily on climate change, sustainability, and international
cooperation. The United States must establish a strategic plan to promote its
national security, energy, and economic interests in the Arctic. An analysis and
plan to support the responsible development of Alaska’s energy assets should
be apriority.

New Policies

e Defend American interests in the Artic Circle. The next Administration
needs to define American strategic and economic interests in the Arctic
Circle. AE should help to identify those interests, as well as threats posed by
countries like Russia and China, and develop appropriate policy options for
the President’s consideration.

e Ensure that AE is clearly focused. In particular, this means identifying
USS. energy interests in the Arctic Circle, identifying foreign government
and commercial interests and activity in the region, and ensuring that
the United States does not forgo important energy and national security
interests in the Arctic.

e Expand AE’s operations in Alaska. AE’s operations in Alaska should be
expanded to encompass broader national energy security interests in the
region including rare earths, oil, and natural gas. AE should also be the lead
for DOE Antarctic operations as a counter to growing Russian and Chinese
interest in Antarctic resources.

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Personnel
AE should provide a senior Arctic Energy official to the U.S. Arctic Council del-
egation in recognition of the key role that energy plays in Arctic development.

OFFICE OF INTELLIGENCE AND
COUNTERINTELLIGENCE (IAC)

Mission/Overview

DOE's Office of Intelligence and Counterintelligence “is responsible for all intel-
ligence and counterintelligence activities throughout the DOE complex, including
nearly thirty intelligence and counterintelligence offices nationwide.” It “lever-
age[s] the Energy Department’s unmatched scientific and technological expertise
in support of policymakers as well as national security missions in defense, home-
land security, cyber security, intelligence, and energy security” and “is a member
of the U.S. Intelligence Community.””

Needed Reforms

Robust security protocols are necessary to protect DOE technology and innova-
tions from foreign penetration and espionage. In addition, DOE’s general isolation
from the rest of the Intelligence Community prevents appropriately cleared senior
staff from getting the thorough issue briefings that their colleagues elsewhere in
the national security realm receive.

New Policies

e Improve accountability and utilization. IAC should be led by a qualified
appointee and report directly to the Secretary and Deputy Secretary. IAC
will require strong political leadership, which means finding an appointee
with an IC background. In addition, upgrading the new DESAS’s general
security posture would require the Secretary’s direct intervention to
improve protocols and access the necessary resources from the rest of the
IC. This would not be achievable at a lower level.

OFFICE OF POLICY (OP)

Mission/Overview

OP has taken various roles over different Administrations. During the Obama
Administration, OP was a large office and was tasked with drafting the Quadrennial
Energy Review (QER). The Trump Administration shut down the QER and gave
OP a leaner research and advisory role. Under the Biden DOE, OP appears to be
focused on preparing reports on climate change and renewables.*°

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Needed Reforms

e Help to develop policy. Because the appointees running DOE’s various
program offices are properly focused on managing their programs, not
enough thought is given to identifying future challenges and developing
potential solutions to benefit the American people.

e Help to ensure that policies are properly implemented. Policy
initiatives from the Secretary are often understood or implemented
inconsistently by program offices. OP can help the Secretary to ensure
that important policy initiatives are implemented, particularly when they
involve multiple program offices.

New Policies

e Develop a National Energy Security Strategy. OP could be tasked with
developing a National Energy Security Strategy for the Secretary. This strategy
could be prepared in conjunction with the White House National Security
Strategy and the DOD National Defense Strategy to convey these priorities
to Congress and design policy initiatives for their implementation. Such a
strategy could summarize cyber and physical threats to energy infrastructure,
challenges involved in obtaining rare earth minerals to support domestic
energy production and consumption, and foreign actions that threaten U.S.
energy security and dominance. However, it would be important to guard
against attempts to transform the strategy into a government-led industrial
policy or, in a progressive Administration, an economy-wide climate policy.

OFFICE OF TECHNOLOGY TRANSITIONS (OTT)

Mission/Overview

The Secretary of Energy authorized the creation of this office in 2015. Its mis-
sion “is to expand the public impact of the department’s research, development,
demonstration, and deployment (RDD&D) portfolio to advance the economic,
energy and national security interests of the nation.” OTT serves as “the front door
to U.S. Department of Energy’s...products, facilities and expertise” and “integrates

market pull’ into its planning to ensure the greatest return on investment from
DOE’s RDD&D activities to the taxpayer.”*

Needed Reforms

OTT should ensure that the best emerging technologies from DOE and the
National Labs are properly supported and protected. Because America’s techno-
logical edge is a key national security asset, and in view of China’s predatory thefts
of intellectual property, OTT should:

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e Ensure that R&D funds are used for projects that protect and
advance that edge.

e Ensure that successful advances, with a focus on new natural
resource development technologies, artificial intelligence,
cybersecurity, and space, are transferred swiftly to American
interests in the private sector.

New Policies

e Focus on benefits to Americans. OTT’s operations should be based on
the recognition that the new technologies generated by American taxpayers’
investment in DOE are a significant national security asset rather than some
neutral scientific gift to humanity.

e Increase oversight and coordination. OTT needs to be vigilant in
overseeing and coordinating OTT offices associated with each National
Lab. For security and economic espionage reasons, the work funded by the
American people needs to be protected, and when commercialized, it needs
to go to American businesses.

OFFICE OF SCIENCE (SC)

Mission/Overview

The Office of Science (SC) supports and oversees research facilities and pro-
grams that cover basic science through its application to the demonstration and
deployment of energy technologies. SC oversees 10 of the 17 DOE National Labs
and 28 major federal research user facilities. Its mission is to preserve U.S. leader-
ship in science, fund and perform basic research, and provide the scientific facilities
that the private sector is unable or unwilling to provide. New initiatives include
quantum information sciences and artificial intelligence. SC is led by a Senate-con-
firmed Director at the Assistant Secretary level and has eight program offices.*”

Needed Reforms

The next conservative President should commit the United States to scientific
dominance to support national and economic security, especially in light of similar
efforts by China. To aid in this effort, the Office of Science should:

e Return to its primary mission: nonpartisan and basic science. SC’s
mission should be international leadership in basic and early applied science
and provision of world-leading facilities for this work. The Infrastructure
Investment and Jobs Act and Inflation Reduction Act mark the major

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reorientation of DOE primarily from defense applications in the NNSA and
basic and early applied science across SC and the applied offices to a massive
federal research, development, demonstration, and commercialization body.
Distraction from SC’s basic science mission should be prevented.

Increase the level of accountability. The National Laboratories need to
be more directly accountable to the Secretary of Energy and Congress for
their work and management.

New Policies

Commit to U.S. science dominance. The United States is losing its
dominance in scientific discoveries and technological development. China
and other adversaries have been stealing American science and technology
for years and are now on the verge of dominating science—a development that
is fraught with negative strategic and economic implications for the United
States. The next Administration must commit itself to ensuring that the U.S.
continues to dominate scientific discovery and technological advancement.

Refocus on mission and eliminate duplication and waste. The
Administration should work with Congress to rationalize the National Lab
network to meet specific national objectives (such as the NNSA laboratories’
role in national defense) and conduct basic research that the private sector
would not otherwise conduct. Activities that duplicate those of other
government agencies or the private sector should be eliminated.

Properly manage the National Labs’ contributions to the private
sector. SC should improve private-sector access to the National Labs,
through programs like the GAIN voucher program and consistent with
national security considerations, while ensuring that the economic benefits
of taxpayer-funded technologies flow back to taxpayers through patent-
review sharing or a revolving fund.

Budget

The Office of Science was appropriated slightly more than $7 billion in FY 2021,

and DOE requested slightly less than $7.8 billion for FY 2023.**

OFFICE OF ENVIRONMENTAL MANAGEMENT (EM)

Mission/Overview

The Office of Environmental Management’s mission is to “complete the

safe cleanup of [the] environmental legacy resulting from decades of nuclear

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weapons development and government-sponsored nuclear energy research.”®* Its
cleanup program is the world’s largest, and EM reports that 92 (of 107) sites have
been completed.*®

According to the U.S. Government Accountability Office, “DOE is responsible
for the largest share of the federal government’s environmental liability—about 85
percent in fiscal year 2020.”*’ Since 2011, EM has spent a cumulative total of $63.2
billion, and its liability has grown by $243 billion.** It is currently projected that
cleanup will take another 70 years (FY 2022 to FY 2091).® Projected “Low Range”
and “High Range” lifecycle costs total slightly less than $652.4 billion and slightly
more than $887.2 billion, respectively.”

Needed Reforms

Some states (and contractors), see EM as ajobs program and have little interest
in accelerating the cleanup. EM needs to move to an expeditious program with
targets for cleanup of sites. The Hanford site in Washington State is a particular
challenge. The Tri-Party Agreement (TPA) among DOE, the Environmental Pro-
tection Agency, and Washington State’s Department of Ecology has hampered
attempts to accelerate and innovate the cleanup. A central challenge at Hanford
is the classification of radioactive waste. High-Level Waste (HLW) and Low-Level
Waste (LLW) classifications drive the remediation and disposal process. Under
President Trump, significant changes in waste classification from HLW to LLW
enabled significant progress on remediation. Implementation needs to continue
across the complex, particularly at Hanford.

New Policies
The next Administration should:

e Accelerate the cleanup. This means that a comprehensive cost projection
and schedule reflecting the entire scope of the job should be developed and
appropriate reforms should be instituted. To save taxpayers a potential
$500 billion over the long run and reduce current risk, a 10-year program
to complete all sites by 2035 (except Hanford with a target date of 2060)
should be considered. Such a commitment will require increased funding
for EM during those accelerated periods. To the extent that funding from
the IIJA and IRA cannot be repealed, requests to divert those funds to EM’s
cleanup obligations should be considered.

e Fully implement High-Level Waste determination. Fully adopting

the High-Level Waste (HLW) determination across the DOE complex,
particularly at Hanford, would allow LLW to be grouted rather than vitrified.

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e Increase the use of commercial waste disposal. Using commercial
disposal would reduce capital costs (~ $2 billion) for new disposal sites to
accelerate cleanup and reduce local post-cleanup environmental liability at
multiple sites.

e Revisit the Hanford cleanup’s regulatory framework. Hanford poses
significant political and legal challenges with the State of Washington, and
DOE will have to work with Congress to make progress in accelerating
cleanup at that site. DOE and EPA need to work more closely to coordinate
their responses to claims made under the TPA and work more aggressively
for changes, including congressional action if necessary, to achieve workable
cleanup goals.

e Establish more direct leadership and accountability to the Deputy
Secretary consistent with Government Accountability Office
recommendations.”

e Change Environmental Management’s culture to promote innovation
and completion.

Budget

Environmental Management received slightly less than $7.6 billion in FY 2021,
and its budget request for FY 2023 is approximately $8.06 billion.” The additional
funding necessary to accelerate closure of the program will need to be considered
as part of a broader government-wide discussion about yearly appropriations.

OFFICE OF CIVILIAN RADIOACTIVE WASTE MANAGEMENT (OCRWM)
(CURRENTLY OFFICE OF SPENT FUEL AND WASTE DISPOSITION)

Mission/Overview

The Nuclear Waste Policy Act (NWPA) of 1982 conferred the responsibility
for commercial nuclear waste disposal on the federal government,” and in 2002,
Congress designated a single repository located at Yucca Mountain in Nevada as
the national repository site. The act also established the Office of Civilian Radio-
active Waste Management (OCRWM).” The Obama Administration shut down
OCRWM in 2010. The Office of Spent Fuel and Waste Disposition, which is headed
byanon-confirmed Deputy Assistant Secretary in the Office of Nuclear Energy, is
currently responsible for the management of nuclear waste, and interim disposal
is taking place on various sites. Providing a plan for the proper disposal of civilian
nuclear waste is essential to the promotion of nuclear power in the United States.

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Needed Reforms

Work with the Nuclear Regulatory Commission as it reviews DOE’s
permit application for Yucca Mountain. According to both the scientific
community and global experience, deep geologic storage is critical to any
plan for the proper disposal of more than 75 years of defense waste and
80,000 tons of commercial spent nuclear fuel.” Yucca Mountain remains a
viable option for waste management, and DOE should recommit to working
with the Nuclear Regulatory Commission as it reviews DOE’s permit
application for a repository. Finishing the review does not mean that Yucca
Mountain will be completed and operational; it merely presents all the
information for the State of Nevada, Congress, the nuclear industry, and the
Administration to use as the basis for informed decisions.

Reform the licensing process. The reactor licensing process is inadequate.
Fixing nuclear waste management will require wholesale reform that
realigns responsibilities, resets incentives, and introduces market forces
without creating chaos within the current nuclear industry that has been
built around the current system.

Produce concrete outcomes from consent-based siting. Beginning in
the Obama Administration and resurrected during the Biden Administration,
consent-based siting for a civilian waste nuclear repository has been a way

to delay any politically painful decisions about siting a permanent civilian
nuclear waste facility. In 2022, DOE announced $16 million to support local
communities in consent-based siting.*° The next Administration should

use the consent-based-siting process to identify and build temporary or
permanent sites for a civilian waste nuclear repository (or repositories).

New Policies

Restart Yucca Mountain licensing. DOE should restart the Yucca
Mountain licensing process. Any continuation of interim storage facilities
should be made part of an integrated waste management system that
includes geologic storage. Further, building on the consent-based siting
process already underway, DOE should find a second repository site.

Fix the policy and cost drivers that are preventing nuclear storage.
The federal government continues to hold $46 billion’ in the Nuclear
Waste Fund (NWF),”’ funded by utilities and their ratepayers for permanent
disposal of nuclear waste. However, no such storage exists, and spent
nuclear fuel remains on site at most nuclear plants. Meanwhile, Congress
uses those funds to finance unrelated spending. Moreover, DOE’s

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Mandate for Leadership: The Conservative Promise

violation of its contractual obligation to take the waste has resulted in the
payment of “approximately $10.1 billion in settlements and judgments to

contract holders.”””

e Develop new NWF funding and accounting mechanisms that allow
licensed nuclear operators to guarantee resources for future nuclear
waste disposal while also maintaining control of those resources.

e Reconstitute OCRWM. OCRWM, as already established by statute, should
be tasked with developing the next steps on Yucca Mountain and nuclear
waste management. These steps should include initiating market reforms,
including significant amendments to the NWPA, to allow additional
industry responsibility for managing waste, market pricing and competition
for waste services, and the opportunity for Nevadans to have more
partnership involvement with any nuclear facility at Yucca Mountain.

e Reestablish, consistent with the Nuclear Waste Policy Act,
the position of Director of the Office of Civilian Radioactive
Waste Management.

Budget

Within the Office of Nuclear Energy budget, approximately $100 million is set
aside for fuel cycle and waste management activities.°° These funds should be
transferred to the newly established OCRWM, which should also be responsible
for managing the Nuclear Waste Fund and given access to the fund as necessary
to carry out its responsibilities.

NATIONAL NUCLEAR SECURITY ADMINISTRATION (NNSA)

Mission/Overview

NNSA’s primary mission is to provide and maintain a modern, safe, and effective
nuclear deterrent for the United States. This includes the design and production of
nuclear warheads, their integration with delivery systems, and their safe storage
and decommissioning. NNSA’s responsibilities also include developing nuclear
reactors for the U.S. Navy and “work[ing] to prevent nuclear weapon proliferation
27101

and reduce the threat of nuclear and radiological terrorism around the world.
NNSA was established by the NNSA Act, which also defines its authority.’

Needed Reforms

The United States, through the NNSA, needs to make the design, development,
and deployment of new nuclear warheads a top priority. Existing warheads were

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2025 Presidential Transition Project

designed and built during the Cold War, and the U.S. lacks sufficient plutonium
production capabilities.’"* Because this process will take time, NNSA and the
NNSA Labs need to ensure that existing nuclear warheads are viable and provide
an appropriate strategic deterrent.

New Policies

The expansion of Chinese nuclear forces, the continued nuclear threat
from Russia, and active nuclear programs in North Korea, Iran, and elsewhere
require NNSA’s recommitment to the nuclear mission. A conservative Adminis-
tration should:

e Continue to develop new warheads for each branch of the triad (land,
sea, and air defenses). If possible, reverse the Biden Administration’s
decision to retire the B83 bomb (in order to maintain two aircraft-delivered
warheads) and its decision to cancel the submarine-launched cruise
missile (SLCM).'* Also undertake an evaluation of the need for nuclear
antisubmarine and air defense weapons in light of emerging threats.

e Maintain two production sites for plutonium pits (a key element of
warhead production) at Los Alamos and Savannah River.'”

e =6Reject ratification of the Comprehensive Test Ban Treaty and
indicate a willingness to conduct nuclear tests in response to
adversary nuclear developments if necessary. This will require
that NNSA be directed to move to immediate test readiness to give the
Administration maximum flexibility in responding to adversary actions.

e Review all new Navy, Department of Homeland Security, and
U.S. Department of Transportation Maritime Administration
construction programs. The review should be conducted by the Director
of Naval Reactors (DNR) with an eye to the possible inclusion of advanced
affordable nuclear reactor technology and extension of DNR authority over
these agencies’ nuclear construction programs.

e Review the non-national security portfolios at the Los Alamos,
Lawrence Livermore, and Sandia labs and identify divestments to
focus on nuclear deterrence. Los Alamos, Lawrence Livermore, and
Sandia provide unique capabilities for nuclear deterrence, and each
lab maintains extensive non-national security research programs and
commercial activities.

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e Review the operations of the Nuclear Weapons Council (NWC). The
statutorily established NWC is required to report to the President and
Congress but needs to refocus its efforts on providing comprehensive
oversight of DOE and DOD nuclear weapons policy and requirements.

Budget

Concurrent modernization of the nuclear triad and its warheads will be a major
challenge to the DOD and DOE budgets over the coming decade. DOE non-nuclear
programs should be the first source of additional resources for NNSA activities.
Divestment of non-nuclear activities from NNSA laboratories can address some
overhead and operational costs. NNSA received $19.7 billion in 2021, and its FY
2023 budget request was $21.4 billion.’”° The next Administration should ensure
that funding is targeted to the accelerated development of new warheads.

Personnel

NNSA has tended to act as though it is not part of DOE and has resisted oversight
by the Secretary of Energy. The NNSA Act grants some autonomy to the NNSA, but
it also makes it clear that NNSA is under the authority of the Secretary. NNSA’s
leaders need to understand that ultimately, they report to the Secretary.

FERC: ELECTRIC RELIABILITY AND RESILIENCE

Mission/Overview

The Federal Power Act tasks FERC, along with the FERC-designated North
American Electric Reliability Corporation (NERC), with promoting the reliability
of the bulk power system (the transmission and generation needed to power the
electric grid).!°” NERC develops technical standards, and FERC adopts them as
mandatory standards (including cyber security standards) with which transmis-
sion providers, generators, and utilities must comply. Under the Federal Power
Act, critical electric infrastructure security and issues like electromagnetic pulse
(EMP) are addressed by both FERC and DOE.?8 In addition, the Infrastructure
Investment and Jobs Act directed FERC to establish incentive-based rate treat-
ments by encouraging utilities to invest in advanced cyber security technology and
participate in cyber security threat information-sharing programs.

Needed Reforms

There is a growing problem with the electric grid’s reliability because of the
increasing growth of subsidized intermittent renewable generation (like wind and
solar) and a lack of dispatchable generation (for example, power plants powered
by natural gas, nuclear, and coal), especially during hot and cold weather.’ FERC
and NERC have been studying the potential for generation shortages across the

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nation in the summer'” and winter." Cyber and physical attacks also threaten the
grid. Specific areas for reform include the following:

e Limit the impact of subsidized renewables on price formation.
Subsidized renewable resources are undermining electric reliability in
RTOs. The increase in subsidized, intermittent resources is undermining
the ability of RTOs’ pricing models to support the reliable dispatchable
generation that is needed to serve the grid at all times."”

e Reform the application of reserve margins. Reserve margins have
become largely meaningless. Traditionally, the electric industry has
used “reserve margins” to ensure that the grid has enough power plants
to guarantee reliability. Generally, reserve margins represent the amount
of generation available (power plants) to meet peak electric demand (the
time of day and year when people are using the most electricity) plus a
percentage of additional generation for backup."'? However, given the
increasing number of intermittent resources (like solar, which may be
available during the heat of the day but disappears as the sun sets), other
dispatchable generation needs to be available to meet customers’ electricity
requirements. Therefore, the definitions and calculations of reserve
margins and peak load need to be updated to focus on the modern grid’s
reliability challenges for all times of the day and year.

e Recognize the interdependence of electric generation and natural
gas. The interdependence of electric generation and natural gas pipelines
continues to grow. Given natural gas’s important role in generating
electricity, especially as backup when renewables are not available, lack of
natural gas pipelines or attacks on existing pipelines could threaten our
ability to generate electricity.

e Expand resource diversity and reliability. Resource diversity is needed
to support grid reliability. Pressure to use 100 percent renewables or non-
carbon emitting resources threatens the electric grid’s reliability. A grid that
has access to dispatchable resources such as coal, nuclear, and natural gas
for generating power is inherently more reliable and resilient.

e Protect against cyber and physical attacks. The threat of cyber and
physical attacks on electric infrastructure by foreign actors like China,
Russia, North Korea, and Iran, as well as terrorists, continues to grow. The
attacks with guns on substations in North Carolina in December 2022 that
left customers without power demonstrate the grid’s vulnerability.’“

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New Policies

Reform RTOs to require reliability. FERC should direct RTOs to
establish reliability pricing for eligible dispatchable generation resources
or require intermittent resources to procure backup power for times when
they are not available to operate. In addition, Congress should repeal
subsidies for generation resources.

Update the definition and calculation of reserve margins to support
reliability. FERC, NERC, and DOE should revise the definition of reserve
margins to ensure the grid’s reliability throughout the day and the year. This
will mean recognizing that reserve margins may need to consider “net peak”
and exclude non-dispatchable resources from inclusion in reserve margin
calculations.

Expand and protect natural gas infrastructure in support of electric
generation. FERC needs to ensure that its consideration of natural gas
pipeline applications recognizes the role that natural gas plays in electric
reliability. FERC also needs to make sure that RTO pricing mechanisms
support generators that need to contract for natural gas service on

a firm basis.

Support resource diversity and reliability. FERC, NERC, and DOE play
key roles in balancing consumer, industrial, and national defense interests
to ensure an ongoing reliable, plentiful, and accessible national electricity
supply. NERC reliability reviews and FERC’s reliability roles should be
aware that overreliance on any one power generation fuel source entails
concurrent cost and availability risk. FERC should reform market rules that
unduly discriminate against dispatchable resources needed for reliability.

Strengthen security against cyber and physical threats. FERC and
NERC need to enhance the security of the bulk power system by, for
example, banning Chinese-made components, investing in transformers,
and hardening substations and other critical infrastructure. DOE should
play a leading role in identifying and addressing threats to the grid.

FERC: RTOS/ISOS AND “ELECTRIC POWER MARKETS”

Mission/Overview

For more than 20 years, FERC has issued regulations and directed policies for

the creation and operation of regional transmission organizations (RTOs) and

independent system operators (ISOs) to manage the dispatch of generation and

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transmission of electricity."° Under the misnomer “electric power markets,” these
regulatory constructs use marginal price clearing auctions (in some cases both
hourly day-ahead auctions and five-minute day-of-need auctions) and locational
marginal pricing to procure electric generation and set prices to meet the needs of
the grid. Some RTOs also have capacity auctions. Of the nation’s seven RTOs, six
are subject to FERC jurisdiction (but not ERCOT in Texas). Areas without an RTO
include the Southeast and portions of the West (although California is in an RTO).

Needed Reforms
Too many conservatives have assumed that because RTOs are described as
“electric power markets,” market forces of supply and demand set electric prices
and benefit customers. RTOs are complex regulatory constructs (with rules set
by FERC) that obscure government interference and preferences for preferred
resources. Furthermore, government preferences and subsidies for resources like
wind and solar distort price formation for electricity that is undermining the reli-
ability of the grid. Finally, customers are not seeing the full economic benefits that
non-fuel, subsidized resources should provide. Additionally:

e Electric reliability is threatened in many RTOs. As subsidized
renewables (like wind and solar receiving tax credits) and state renewable
portfolio standards (RPS) programs have disrupted market functions, price
distortions have driven out reliable, dispatchable resources like coal, natural
gas, and nuclear generation in various RTOs. The result: Electric reliability
is decreasing in many parts of the country.” As noted, FERC and NERC
have been studying the potential for summer and winter shortages.”

e RTOs are not providing the full economic benefits of renewables to
customers. Because RTOs use marginal price auctions where natural gas
usually sets the clearing price paid to all generators, the economic benefits
of renewables (no fuel, tax credits, etc.) are flowing mainly to renewables
investors and not to customers (although customers do benefit from some
decrease in marginal costs). Yet reliability is decreasing, so customers are
getting the worst of both worlds, paying more for electricity and having less
reliability for the money.

e Big Green and Big Tech want RTO expansion. Renewable developers,
large industrial users, and Big Tech tend to want RTO expansion for their
own economic and ESG reasons. These entities can benefit economically
from the complexity and marginal pricing regime of the RTOs. Increased
costs and reliability problems are often shifted to other customers.

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e Unlike vertically integrated utilities that are accountable to state
elected officials and state public utility commissions, RTOs and
their participants are accountable only to FERC. Even then, however,
accountability is indirect through the tariffs (rules) that the RTOs adopt and
FERC approves. In addition, unlike utilities, generators in an RTO have no
obligation to serve customers.

New Policies
FERC must make reliability of the grid and service to end use top priorities. To
do so, it should:

e Reexamine the premise of RTOs. RTOs no longer seem to work for the
benefit of the American people. Marginal price auctions for energy are not
ensuring the reliability of the grid and are not passing the full economic
benefits of subsidized renewables on to customers. FERC needs to
reexamine the RTOs under its jurisdiction to make sure that they procure
reliable and affordable electricity for the benefit of the American people.

e Ensure that RTOs return to market fundamentals so that they serve
customers, not special interests and political causes. FERC should
require RTOs to ensure that reliable, dispatchable resources are properly
valued to provide electricity when needed for the benefit of customers.
Potential reforms could include:

1. Requiring renewable generators to provide intra-day backup by
dispatchable on-demand generation so that bids by intermittent
resources into RTOs equate fairly with far more valuable on-demand
dispatchable resources;

2. Creating dual energy markets for dispatchable and nondispatchable
resources; or

3. Eliminating capacity markets where intermittent resources participate
and instead establishing “reliability” markets where dispatchable
on-demand resources participate.

Alternatives to marginal price auctions also should be considered.

e Direct the RTOs to ensure that the economic benefits of renewables
(like tax credits and no fuel costs) are passed on to customers.

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e End undue discrimination that allows subsidized resources to distort
price formation in RTOs.

e §6©Affirm its commitment that states will decide whether to join
an RTO instead of imposing RTOs on regions that do not want
them. FERC should also consider allowing states to enter into non-RTO
power pools with alternative structures for the sharing of resources and
electric generation.

FERC: ELECTRIC TRANSMISSION

Mission/Overview

Under the Federal Power Act, FERC has the authority to regulate the rates,
terms, and conditions of interstate electric transmission. (Pursuant to court cases,
interstate transmission can be entirely within a state, although the part of Texas
served by ERCOT is not under FERC transmission jurisdiction.)

Needed Reforms

FERC has been considering how to plan for and allocate costs for new trans-
mission lines and how new generation resources will be interconnected to the
transmission grid. (Transmission expansion and replacement decisions are usu-
ally made by local utilities or by an RTO or regional planning entity). Through
two major rulemakings,"* FERC is attempting to facilitate the building of more
long-range transmission lines and to socialize more of the costs of transmission
buildouts to more customers in order to make it cheaper for renewable develop-
ers (primarily) to interconnect to the grid and sell their power. Socializing such
costs is a form of subsidy for generators and will cause further price distortions
in RTOs and ISOs that will make it less economical for reliable, dispatchable
resources like coal, nuclear, and natural gas to stay operational and support
reliability.”

Also, under the Infrastructure Investment and Jobs Act, DOE and FERC are
granted authority to site and permit high-priority transmission lines as National
Interest Electric Transmission Corridors (NIETCs). The Inflation Reduction Act
provides funding to DOE to support transmission expansion.’”° These initiatives
will undermine state input and decision-making. FERC will consider rules on how
NIETC transmission applications are to be made.

New Policies

FERC should either change course on its existing transmission rulemakings (if
still in progress) or issue a new rulemaking to:

— 405 —

Mandate for Leadership: The Conservative Promise

e Ensure that transmission planning and interconnection processes
are resource neutral.

e Prevent socializing costs for customers who do not benefit from the
projects or justifying such cost shifts as advancing vague “societal
benefits” such as climate change.

e Stop cost allocation from becoming a subsidy for generators, such
as renewables.

With respect to NIETCs, FERC and the new DESAS should ensure that state
interests are respected and not allow such NEITC transmission lines to be devel-
oped as a mere subsidy to renewable developers. Furthermore, much of the
transmission buildout (including its attendant costs) is being driven by renewable
developers seeking market share. These projects are causing rates for customers
to go up and hurting reliability. FERC needs to ensure that transmission buildouts
are planned for the benefit of customers.

FERC: NATURAL GAS PIPELINES

Mission/Overview

FERC permits, sites, and authorizes the construction and operation of inter-
state natural gas pipelines.'”' It also regulates the rates for the shipping of natural
gas’ (but not the price of the natural gas commodity, which is market based).
FERC is charged with ensuring that natural gas pipelines are approved if they are
required by the “public convenience and necessity.”!** Pipeline permitting is sub-
ject to environmental reviews under NEPA, and the rate for the pipeline and the
shipping of the commodity is set by FERC under a just and reasonable standard.
Once FERC approves a project, the holder of the certificate has the sovereign’s
power of eminent domain.

Needed Reforms

Natural gas pipelines are vital for the economy, manufacturing, heating, and
electric generation. Opposition from “Keep it in the ground” environmentalists
has made it harder to gain approvals for natural gas pipelines. Under Democrat
leadership, FERC has proposed official policies to consider upstream and down-
stream GHG emissions from the use of the natural gas that would be shipped in
the pipeline to be part of FERC’s public-interest determination when deciding
whether to approve a pipeline. There is conflicting direction from the D.C. Circuit
on the GHG issue, which also could be seen as a “major questions” issue under the
U.S. Supreme Court’s West Virginia v. EPA decision.'**

— 406 —

2025 Presidential Transition Project

New Policies
FERC should:

e Recommit itself to the NGA’s purpose of providing the American
people with access to affordable and reliable natural gas.

e Limit its NGA decision-making on natural gas pipeline certificates to
the question of whether there is a need for the natural gas.

e Limit its NEPA analysis to the impacts of the actual pipeline itself,
not indirect upstream and downstream effects.

In addition, Congress, the states, and FERC should consider how better to pro-
tect and compensate property owners whose property is taken for the benefit of the
public. FERC also needs to be mindful that natural gas pipelines and projects are
important for domestic access to natural gas, including local natural gas utilities,
natural gas-fired electric generation, and manufacturing, as well as for exports of
liquefied natural gas.

FERC: LNG EXPORT FACILITIES

Mission/Overview

FERC permits, sites, and authorizes the construction and operation of LNG
export facilities.'*° It does not authorize the export of natural gas; DOE exercises
that authority. LNG export facilities are important for delivering natural gas to
markets around the world and have become an important policy tool in limiting
the ability of Russia and Middle Eastern countries to use energy as a tool in for-
eign affairs.

Needed Reforms

LNG exports are opposed by climate activists. In addition, some domestic man-
ufacturers argue that LNG exports decrease available U.S. supplies of natural gas
and increase the domestic price, thereby harming the competitive advantages of
U.S. manufacturers in world markets.

Currently, most LNG export facilities are along the Gulf of Mexico in Texas and
Louisiana.'*° Attempts to build facilities on the west coast (Jordan Cove LNG”)
and the east coast have not moved forward for a variety of reasons; delays and
costs of litigation can cause developers to cancel projects. An Alaska facility was
approved by FERC in 2020, and the Biden Administration has indicated its sup-
port.'?* An east coast facility in Pennsylvania (or nearby) would unlock Marcellus
shale natural gas for export.

— 407 —

Mandate for Leadership: The Conservative Promise

FERC is considering policy statements that would consider GHG emissions as
part of its NEPA review and its NGA determination as to whether approval of an
LNG export facility is consistent with the public interest.

New Policies

Since Congress through the NGA has already determined that LNG exports to
countries with free trade agreements are in the public interest,’ and because LNG
exports help to ensure America’s ability to support our friends and allies around
the world while also supporting domestic natural gas production, FERC:

e Should not use environmental issues like climate change as a reason
to stop LNG projects.

e Should ensure that the natural gas pipelines that are needed deliver
more of the product to market, both for domestic use and export, and
are reviewed, developed and constructed in a timely manner.

NUCLEAR REGULATORY COMMISSION

Mission/Overview

The Energy Reorganization Act of 1974'°° created the Nuclear Regulatory Com-
mission (NRC). Before then, the commercial nuclear industry was regulated by
the Atomic Energy Commission (AEC), which was established by the 1954 Atomic
Energy Act.’ Importantly, the AEC was responsible for encouraging and regulat-
ing commercial nuclear power. Broad criticism of this dual function was a major
factor in the establishment of the NRC, which held regulatory authority while the
newly established Department of Energy held the advocacy function. Today, the
NRC is responsible for a broad range of regulatory activities, including reactor
safety, oversight of nuclear materials, and protection against radiation as well as
permitting new reactors, certifying new reactor designs, and regulating nuclear
waste management activities.

Needed Reforms

In 1989, the NRC established alternative licensing processes that were meant to
provide a more predictable and efficient regulatory pathway for new Light Water
Reactors (LWRs) by combining construction and operating nuclear power plant
licenses, allowing for Early Site Permits, and establishing a framework for pre-
approval of reactor designs. More recently, the Nuclear Energy Innovation and
Modernization Act directed the NRC to establish a technology-neutral licensing
process for new, advanced reactor technologies.!*? Despite these efforts, the NRC
remains a significant cost and regulatory barrier to new nuclear power. Especially

— 408 —

2025 Presidential Transition Project

frustrating is that these costs to a large extent are due to the agencies being overly
prescriptive rather than outcomes-focused and fall on well-known and understood
LWR reactor technologies.

New Policies

While refocusing its regulatory efforts on new reactor technologies, the NRC
should also continue to ensure the security of radiological sources and mitigate
cybersecurity risks across the industry. Applications for Combined Operating
Licenses (COLs) and design certifications that rely on light-water technology
should generally be completed within two years. Early Site Permits should gener-
ally be issued within one year for construction on or adjacent to an existing reactor
site. Additionally, the NRC should:

e Expedite the review and approval of license extensions of existing
reactors, which will require the NRC to streamline and focus its
NEPA review process.

e Set clear radiation exposure and protection standards by eliminating
ALARA (“as low as reasonably achievable”) as a regulatory principle
and setting clear standards according to radiological risk and dose
rather than arbitrary objectives.

e Work with Congress to reform its funding approach so that licensee
fees are generally required for activities that are specific toa
regulated entity, with other agency costs being provided through
normal appropriations.

Budget

In FY 2022, the NRC was required to recover approximately 85 percent of its
$887.7 million budget through licensee fees.** The Nuclear Energy Innovation
and Modernization Act requires the NRC to recover nearly all of its costs through
fees. These reforms would likely not cost additional money but could rebalance
the fee-versus-appropriations calculation.

AUTHOR’S NOTE: The preparation of this chapter was the work of many individuals. All contributors to this
chapter are listed at the front of this volume, but | wish to give special thanks to Brent Bennett, Willis Bixby, Travis
Fisher, Ben Lieberman, Brian McCormack, Tom Pyle, Mark Robeck, Daniel Simmons, Jack Spencer, Katie Tubb, and
David Walsh. Though informed by many, the author alone assumes responsibility for the content of this chapter,
and no views expressed herein should be attributed to any particular individual.

— 409 —

Mandate for Leadership: The Conservative Promise

ENDNOTES

14.

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February 13, 2023).

congress.gov/95/sta

and
be enhanced
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political appoin
unique to their
unobstructed pursui
H.R. 6586, Natural

under
OE,

ees run se

U.S. Depar
(accessed February
U.S. Department o
energy.gov/diversity/j
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Department of
advance-diversity-e
ncluding the Nation
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ational Oceanic an
Table, “Environmenta
Department of Energy, Of
Request, Volume 6, Enviro.
iles/2022-09/doe-fy2023
KPMG, “Independent Audi
Financial Report as of and

ment o

uity-
Aer

q
a
P
d Atm

ute/STATUTE-9
DOE also promotes domestic energy
he private sector on physical an
he next Administration.
E, FE, and EERE

Energy, “Promoti
3, 2023).
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ustice40-ini
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ojects Agency,

13, 2023).

Secu

ives.
Law No

of Econ

onautics an

ice of Chie

tor’s Report, Un

Department of Energy, Of

d cyber-related

might also be consi
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Al.

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hief Financial Officer, Department of Energy FY 2023 Congressional

Budget Request, Budget in Brief, pp. 19, 24, and 105.

ternational Affairs, “Mission: Our Mission,” https://www.energy.gov/ia/

ternational Affairs, “Priorities: Our Objectives,” https://Awww.eneray.

ov/ia/priorities (accessed February 13, 2023).
ditorial Board, “Biden Signs Up

mate Reparations,” The Wall Street Journal, November 20, 2022,

gns-up-for-climate-change-reparations-europe-fund-un-john-kerry-

arctic/about-arctic-energy-office (accessed March 1, 2023).

National Strategy for the Arctic Region, The White House, October 2022, https://www.whitehouse.gov/wp-
content/uploads/2022/10/National-Strategy-for-the-Arctic-Region.pdf (accessed March 13, 2023).

U.S. Department of Energy, Office of Intelligence and Counterintelligence website, https://www.energy.gov/
intelligence/office-intelligence-and-counterintelligence (accessed February 13, 2023).

See U.S. Department of Energy, Office of Policy, “Publications,” https://www.energy.gov/policy/office-policy
(accessed February 13, 2023).

— 413 —

Mandate for Leadership: The Conservative Promise

81. U.S. Department of Energy, Office of Technology Transitions, “About Us: Mission,” https://www.energy.gov/
technologytransitions/mission-0 (accessed February 13, 2023).

82. Advanced Scientific Computing Research (ASCR); Basic Energy Sciences (BES); Biological and Environmental
Research (BER); Fusion Energy Sciences (FES); High-Energy Physics (HEP); Nuclear Physics (NP); Isotope
R&D and Production (IRP); and Accelerator R&D and Production (ARDAP). U.S. Department of Energy, Office
of Chief Financial Officer, Department of Energy FY 2025 Congressional Budget Request, Volume 5, Science,
April 2022, pp. 10-14, https://www.energy.gov/sites/default/files/2022-05/doe-fy2023-budget-volume-5-
science-v2.pdf (accessed March 1, 2023).

83. For example, the CHIPS and Science Act authorizes $50 billion for the Office of Science. U.S. Department of

Energy, “Statement by Secretary Granholm on Congressional Passage of the CHIPS and Science Act,” July

28, 2022, https://www.energy.gov/articles/statement-secretary-granholm-congressional-passage-chips-and-

science-act (accessed February 13, 2023).

84. U.S. Department of Energy, Office of Chief Financial Officer, Department of Energy FY 2023 Congressional

Budget Request, Volume 5, Science, April 2022, p. 7, https://www.energy.gov/sites/default/files/2022-05/doe-

y2023-budget-volume-5-science-v2.pdf (accessed March 2, 2023).

85. U.S. Department of Energy, Office of Environmental Management, “Mission,” httos://Awww.energy.gov/em/

mission (accessed March 1, 2023).

86. U.S. Department of Energy, Office of Environmental Management, “Cleanup Sites,” https://www.energy.gov/

em/cleanup-sites (accessed March 1, 2023).

87. U.S. Government Accountability Office, “DOE’s Environmental Liability,” GAO-21-585R, June 2021, p. 2, https://

www.gao.gov/assets/gao-21-585r.pdf (accessed March 13, 2023).

88. Chart, “EM’s Annual Spending and Estimated Environmental Liability (Fiscal Years 2011-2020),” in ibid., p. 1.

89. U.S. Department of Energy, Office of Chief Financial Officer, Department of Energy FY 2023 Congressional

Budget Request, Volume 6, Environmental Management, April 2022, p. 53, https://www.energy.gov/sites/

default/files/2022-09/doe-fy2023-budget-volume-6-em-v3.pdf (accessed March 1, 2023).

90. Ibid.

91. U.S. Government Accountability Office, Nuclear Waste: DOE Needs Greater Leadership Stability and
Commitment to Accomplish Cleanup Mission, GAO-22-104805, https://www.gao.gov/assets/gao-22-104805.
pdf#:~:text=DOE%20Needs%20Greater%20Leadership%20Stability%20and%20Commitment%20to,May%20
2022%20GA0-22-104805%20United%20States%20Government%20Accountability%200ffice May 2022,
(accessed February 14, 2023).

92. U.S. Department of Energy, Office of Chief Financial Officer, Department of Energy FY 2023 Congressional

Budget Request, Budget in Brief, pp. 23 and 93.

93. H.R. 3809, Nuclear Waste Policy Act of 1982, Public Law No. 97-425, Title |, Subtitle B.

94. Ibid., Title Ill, § 304.

95. See, for example, Chapter 4, “The Need for Geologic Disposal,” in Blue Ribbon Commission on America’s

uclear Future, Report to the Secretary of Energy, January 2012, pp. 27-31, https://www.energy.gov/sites/

default/files/2013/04/f0/brc_finalreport_jan2012.pdf (accessed February 14, 2023).

96. Press release, “DOE Announces $16 Million to Support Consent-Based Siting for Spent Nuclear Fuel,” U.S.

Department of Energy, September 20, 2022, https://www.energy.gov/articles/doe-announces-16-million-

support-consent-based-siting-spent-nuclear-fuel (accessed February 14, 2023).

97. U.S. Department of Energy, Agency Financial Report, Fiscal Year 2022, DOE/CF-0191, p. 58, https://www.

energy.gow/sites/default/files/2022-11/fy-2022-doe-agency-financial-report.pdf (accessed March 13, 2023).

98. H.R. 3809, Nuclear Waste Policy Act of 1982, Public Law No. 97-425, Title Ill, § 302.

99. Ibid., p. 57.

100. Table, “Department of Energy Comparative Organization by Congressional Control, FY 2023,” p. 5, in U.S.

Department of Energy, Office of the Chief Financial Officer, “FY 2023 Budget Justification: Summary Budget

Documents,” https://www.energy.gov/cfo/articles/fy-2023-budget-justification (accessed March 13, 2023).

101. U.S. Department of Energy, National Nuclear Security Administration, “Missions,” https://www.energy.gov/
nnsa/missions#:-:text=NNSA%20ensures%20the%20United%20States%20maintains%20a%20safe%2C,0f%20
nuclear%20and%20radiological%20terrorism%20around%20the%20world (accessed March 2, 2023).

— 414—-

102

103.
104.

112.

113.

114.

115:

116.

117.

118.

105.

106.

107.
108.

2025 Presidential Transition Project

. §.1059, National Defense Authorization Act for Fiscal Year 2000, Public Law 106-65, 106th Congress, October
5, 1999, §§ 3201-3299, https://www.congress.gov/106/plaws/publ65/PLAW-l06publ65.pdf (accessed

February 14, 2023).

gov/2022/Oct/27/200
arch 2, 2023).

U.S. Department of En
www.energy.gov/nnsa
U.S. Department of En

6 US. Code 8 8240, h
6 US. Code 8 8240-1,

Budget Request, Budget in Brief, p. 27.

See Geller, “U.S. Nuclear Weapons.”
U.S. Department of Defense, 202? National Defense Strategy of the United States of America, Including the
2022 Nuclear Posture Review and the 2022 Missile Defense Review, pp. 3 and 20, https://media.defense.
AL-DEFENSE-STRATEGY-NPR-MDR.PDF (accessed

3103845/-1/-1/1/2022-

ergy, National Nuclea

ergy, Office of Chief Fi

tos://www.law.cornel

/plutonium-pit-produc

https://www.law.corne

ATIO

nancia

Security Administration, “Plutonium Pit Production,” https://
ion (accessed March 13, 2023).
Officer, Department of Energy FY 2023 Congressional

edu/uscode/text/16/8240 (accessed March 2, 2023).
edu/uscode/text/16/8240-1 (accessed March 2, 2023).

109.
110.

111.

This Summer,” May
Announcement.pdf
Ethan Howland, “IS
Utility Dive, Octobe

For example, the California blackouts in Aug
orth American Electric Reliability Corporati
18, 2022, https://www.ne
(accessed February 14, 2

ust 2020 and the Texas blackouts and deaths in February 2021.

O-NE, ERCOT, MISO Face
r 21, 2022, https://www.u

on, “Announcement: Extreme Weather Heightens Reliability Risks
c.com/news/Headlines%20DL/May%2018%202022%20SRA%20
023).
Possible Capacity Shortfalls in Extreme Winter Weather: FERC,”
ilitydive.com/news/FERC-iso-ne-ercot-miso-extreme-winter-

weather-report/634682/ (accessed February 14, 2023), and North American Energy Reliability Corporation,

“Announcement:

ERC Warns Generation Resources Tight in Large Portion of North America This Winter;

November 17, 2022, https://www.nerc.com/news/Headlines%20DL/2022%20WRA%20Release%20final.pdf
(accessed February 14, 2023).

Note

hat the challenges to the grid are com

ing mainly from subsidized renewable resources. Renewable

resources have beneficial attributes, and the electric grid can benefit from embracing an all-of-the-above

approach to power

generation.

See U.S. Department of Energy, U.S. Energy Information Administration, “Glossary: Reserve Margin,” https://

www.eia.gov/tools/glossary/index.php?id=reserve_margin (accessed February 14, 2023).

After Substation A\
attack-on-north-ca
February 14, 2023).
U.S. Department o
SOs,” last updated
February 14, 2023).
Such as th

summer 2022).
See notes 110 and

Dan Frosch and Ginger Adams Otis, “North Carolina Power Outage Leaves 33,000 Without Electricity

tack,” The Wall Street Journal, December 5, 2022, https://www.wsj.com/articles/
rolina-power-substations-leaves-45-000-without-electricity-11670200585 (accessed

Energy, Federal Energy Regulatory Commission, “Power Sales and Markets: RTOs and
May 3, 2022, https://www.ferc.gov/power-sales-and-markets/rtos-and-isos (accessed

Il, supra; North American

e blackouts and shortages in California (August 2020, summer 2022) and Texas (February 2021,

Electric Reliability Corporation, “2022 Summer Reliability

Assessment,” May 2022, https://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/NERC_

SRA_2022.pdf (accessed March

Winter Re

U.S. Department of
Regional T

February 14, 2023).

content/pkg/FR-2022-05-04/pd

3, 2023); and North American Electric Reliability Corporation, “2022-2023
iability Assessment,” November 2022, https://www.nerc.com/pa/RAPA/ra/Reliability%20
Assessments%20DL/NERC_WRA_2022.pdf (accessed March 13, 2023).

Energy, Federal Energy Regulatory Commission, “Building for the Future Through Electric

ansmission Planning and Cost Allocation and Generator Interconnection,” Notice o
Rulemaking, Federal Register, Vol. 87, No. 86 (May 4, 2022), pp. 26504-26611, https:/Awww.govinfo.gov/
/2022-08973.pdf (accessed February 14, 2023), and U.S. Department of
Energy, Federal Energy Regulatory Commission, “Improvements to Generator Interconnection Procedures
and Agreements,” Notice of Proposed Rulemaking, Federal Register, Vol. 87, No. 127 (July 5, 2022), pp.
39934-40032, https://www.govinfo.gov/content/pkg/FR-2022-07-05/pdf/2022-13470.pdf (accessed

Proposed

— 415 —

119.

120.

121.
122.
123.
124.

125.
126.

127.

128.

129.

130.

131.

132.

133.

Mandate for Leadership: The Conservative Promise

During the deregulation-induced 230,000 MW combined cycle plant boom of 1999 to 2003 and beyond,
developers were able to move ahead only with projects that were supported by adequate available gas
transmission and near existing localized transmission hubs. Delinking transmission responsibility from

power gen

construction of a large class of partially usable and often partially stranded generation-only assets.

U.S. Depar
and Econo

economic-
H.R. 6586,
bid., $8 4

(accessed
H.R. 6586,
U.S. Depar

(accessed

means-for.

Carlos Anchondo, “Biden Admin Backs Contested Alaska LNG Projec
ws.net/articles/biden-admin-backs-contested-alaska-Ing-
As discussed in the section on the Office of Fossil Energy and Carbon Management, infra, these automati

www.eene

bid., § 7(0.
est Virginia v. EPA,597U.S.____ (2022), https://www.supremecourt.gov/opinions/21pdf/20-1530_n758.pdf

development-grants (accessed March 13, 2023).
atural Gas Act, Public Law No. 75-688, § 7.
and 5.

arch 2, 2022).
atural Gas Act, Public Law No. 75-688, § 3.

February 14, 2023).

iina H. Farah, Miranda Wilson, and Carlos Anchondo, “Jordan Cove
Gas,” Energywire, December 2, 2021,

-ferc-gas/ (accessed February 14, 2023).

LNG Export Terminals: Existing,” in

approvals should be extended to allies of the United States, not just

H.R. 11510,
www.cong

S. 512, Nuc

https://www.congress.gov/115/plaws/publ439/PLAW-115pu
U.S. Nuclear Regulatory Commiss
p. xii, https://www.nrc.gov/reading-rm/doc-collec
arch 2, 2023).

o those with free trade agreemen

Energy Reorganization Act of 1974, Public Law No. 93-438, 93rd Congress, October 11, 1974, h
ress.gov/93/statute/STATUTE-88/STATUTE-88-Pg1233.pdf (accessed February 27, 2023).

H.R. 9757, Atomic Energy Act of 1954, Public Law No. 83-703, 83rd Congress, August 30, 1954, §§ 21-28
httos://www.congress.gov/83/statute/STATUTE-68/STATUTE-68-Pg919.pdf (accessed February 27, 2023).

Project Dies. What It Means for FERC,
httos://www.eenews.net/articles/jordan-cove-project-dies-what-i

eration, coupled with the heavy incentivization of renewable over gas projects, has promoted the

ment of Energy, Grid Deployment Office, “Grid Deployment Office Launches Transmission Siting
mic Development Grants Program with $760M Inflation Reduction Act Investment,” January
3, 2023, https://www.energy.gov/gdo/articles/grid-deployment-office-launches-transmission-siting-and-

ment of Energy U.S.-based operating export LNG terminals are located in Louisiana (3); Texas
(2); Alaska (1); Georgia (1); and Maryland (1). Map, “North American

Department of Energy, Federal Energy Regulatory Commission, “No
Existing, Approved not Yet Built, and Proposed,” February 8, 2023, h

US.

rth American LNG Export Terminals—
ttos://www.ferc.gov/natural-gas/Ing

,” Energywire, October 25, 2022, https://
project/ (accessed February 14, 2023).

Cc
S

tps://

lear Energy Innovation and Modernization Act, Public Law No. 115-439, January 14, 2019, § 103,

on, Congressional Budget Justifica

AiG —

bl439.pdf (accessed March 2, 2023).

tion Fiscal Year 2022, June 2021,

ons/nuregs/staff/sr1100/v37/index.html (accessed

ENVIRONMENTAL
PROTECTION AGENCY
Mandy M. Gunasekara

MISSION STATEMENT

Creating a better environmental tomorrow with clean air, safe water, healthy soil,
and thriving communities.

A conservative U.S. Environmental Protection Agency (EPA) will take a more
supportive role toward local and state efforts, building them up so that they may
lead in a meaningful fashion. This will include the sharing of federal resources and
agency expertise. Creating environmental standards from the ground up is con-
sistent with the concept of cooperative federalism embedded within many of the
agency’s authorizing statutes and will create earnest relationships among local offi-
cials and regulated stakeholders. This in turn will promote a culture of compliance.

A conservative EPA will track success by measured progress as opposed to the
current perpetual process and will convey this progress to the public in clear, con-
cise terms. True transparency will be a defining characteristic of a conservative
EPA. This will be reflected in all agency work, including the establishment of open-
source science, to build not only transparency and awareness among the public,
but also trust.

The challenge of creating a conservative EPA will be to balance justified skep-
ticism toward an agency that has long been amenable to being coopted by the Left
for political ends against the need to implement the agency’s true function: pro-
tecting public health and the environment in cooperation with states. Further, the
EPA needs to be realigned away from attempts to make it an all-powerful energy
and land use policymaker and returned to its congressionally sanctioned role as
environmental regulator.

— 417 -—

Mandate for Leadership: The Conservative Promise

OVERVIEW

The Status Quo. Not surprisingly, the EPA under the Biden Administration
has returned to the same top-down, coercive approach that defined the Obama
Administration. There has been a reinstitution of unachievable standards designed
to aid in the “transition” away from politically disfavored industries and technolo-
gies and toward the Biden Administration’s preferred alternatives. This approach
is most obvious in the Biden Administration’s assault on the energy sector as the
Administration uses its regulatory might to make coal, oil, and natural gas opera-
tions very expensive and increasingly inaccessible while forcing the economy to
build out and rely on unreliable renewables. This approach has also been applied
to pesticides and chemicals as the Biden Administration pushes the “greening” of
agriculture and manufacturing among other industrial activities.

As a consequence of this approach, we see the return of costly, job-killing
regulations that serve to depress the economy and grow the bureaucracy but do
little to address, much less resolve, complex environmental problems. In some
instances, these actions even work to undermine environmental efforts as they
push industries overseas to countries whose enforcement of pollution-control
requirements is seriously deficient—if indeed they have any meaningful require-
ments at all. Meanwhile, agency costs and staffing have increased significantly.
The EPA’s fiscal year (FY) 2023 request included a 28.8 percent increase in fund-
ing and a 13.3 percent increase in staffing, making it the “highest funding ever”
in EPA’s history.”

Compared to the Obama Administration, there is one key difference in the
Biden Administration’s approach: In a concerted effort to diminish congressio-
nal oversight, the position of EPA Administrator has been overshadowed by the
creation of multiple “Climate Czars” at the Biden White House. In effect, current
EPA Administrator Michael Regan, who has a reputation as a well-meaning, gen-
erally capable former state official, has been left out of the political loop, serving
mostly as a pleasant distraction from EPA’s expansive, costly, and economy-de-
stroying agenda.

A Coopted Mission. The EPA has been a breeding ground for expansion of
the federal government’s influence and control across the economy. Embedded
activists have sought to evade legal restraints in pursuit of a global, climate-themed
agenda, aiming to achieve that agenda by implementing costly policies that oth-
erwise have failed to gain the requisite political traction in Congress. Many EPA
actions in liberal Administrations have simply ignored the will of Congress, align-
ing instead with the goals and wants of politically connected activists.

Pursuit of this globally focused agenda has distracted the agency from fulfilling
its core mission, thereby creating a backlog of missed statutory deadlines,’ and
at times has even led to preventable environmental disasters. During the Obama
Administration, for example, the U.S. experienced two of the worst environmental

— 418 —

2025 Presidential Transition Project

disasters in decades, including the Flint, Michigan, water crisis in 2014+ and the
Gold King Mine spill in 2015.°

Beyond creating such immediate and tangible harm in various communities,
an EPA led by activism and a disregard for the law has generated uncertainty in
the regulated community, vendetta-driven® enforcement, weighted analytics,
increased costs, and diminished trust in final agency actions. Although the U.S.
environmental story is very positive, there has been a return to fear-based rhetoric
within the agency, especially as it pertains to the perceived threat of climate change.
Mischaracterizing the state of our environment generally and the actual harms
reasonably attributable to climate change specifically is a favored tool that the Left
uses to scare the American public into accepting their ineffective, liberty-crushing
regulations, diminished private property rights, and exorbitant costs. In effect, the
Biden EPA has once again presented a false choice to the American people: that
they have to choose between a healthy environment and a strong, growing economy.

Historical Role and Purpose. For many decades, rapid industrial activity
with an unorganized approach to environmental standards significantly degraded
the country’s environment. Particle pollution in the form ofa thick, fog-like haze
that at times was laced with harmful metals was a frequent occurrence across the
country.’ More than 40 percent of communities failed to meet basic water quality
standards, and in 1969, the Cuyahoga River infamously caught fire after sparks
from a passing train ignited debris in the water, which was filled with heavy indus-
trial waste.®

EPA was established on December 2, 1970, following a call by President Rich-
ard Nixon to “rationally and systematically” organize existing piecemeal efforts
to clean up and protect the environment.’ Under Reorganization Plan No. 3, the
EPA was to initiate a “coordinated attack on the pollutants which debase the air
we breathe, the water we drink, and the land that grows our food.”’° Numerous
authorities were consolidated and given to the EPA including research, monitor-
ing, standard-setting, and enforcement activities. The mission to protect public
health and the environment was born, and the first Administrator was sworn in
on December 4, 1970.

Congress followed suit with the landmark Clean Air Act of 1970 (CAA)" and
the Federal Water Pollution Control Act of 1972.” The subsequent Clean Air Act
Amendments of 1990" played a significant role in the expansion of EPA’s responsi-
bilities and legal authority with the agency then being tasked with the development
of new regulatory mechanisms that included, among other things, cap-and-trade
programs for the control of sulfur dioxide and technological standards for nitrogen
oxide emissions from coal-fired power plants, a vastly expanded hazardous air
pollutant program, a federal operating permit program, and new regulations gov-
erning phaseout of the production of ozone-depleting substances in conjunction
with U.S. ratification of the Montreal Protocol in 1988."*

— 419 —

Mandate for Leadership: The Conservative Promise

Subsequently, especially during the Obama Administration, EPA experienced
massive growth as it was used to pursue far-reaching political goals to the point
where its current activities and staffing levels far exceeded its congressional man-
dates and purpose. This expansive status is entirely unnecessary: It has nothing
to do with improving either the environment or public health. The EPA’s initial
success was driven by clear mandates, a streamlined structure, recognition of the
states’ prominent role, and built-in accountability. Fulfilling the agency’s mis-
sion in a manner consistent with a limited-government approach proved to be
extremely effective during the agency’s infancy.

Back to Basics. EPA’s structure and mission should be greatly circumscribed
to reflect the principles of cooperative federalism and limited government. This
will require significant restructuring and streamlining of the agency to reflect
the following:

e State Leadership. EPA should build earnest relationships with state and
local officials and assume a more supportive role by sharing resources and
expertise, recognizing that the primary role in making choices about the
environment belongs to the people who live in it.

e Accountable Progress. Regulatory efforts should focus on addressing
tangible environmental problems with practical, cost-beneficial, affordable
solutions to clean up the air, water, and soil, and the results should be
measured and tracked by simple metrics that are available to the public.

e Streamlined Process. Duplicative, wasteful, or superfluous programs that
do not tangibly support the agency’s mission should be eliminated, anda
structured management program should be designed to assist state and
local governments in protecting public health and the environment.

e Healthy, Thriving Communities. EPA should consider and reduce as
much as possible the economic costs of its actions on local communities to
help them thrive and prosper.

e Compliance Before Enforcement. EPA should foster cooperative
relationships with the regulated community, especially small businesses,
that encourage compliance over enforcement.

e Transparent Science and Regulatory Analysis. EPA should make

public and take comment on all scientific studies and analyses that support
regulatory decision-making.

— 420 —

2025 Presidential Transition Project

ADMINISTRATOR’S OFFICE AND REORGANIZATION RESPONSIBILITY

The Office of the Administrator (AO) is intended to provide executive and

logistical support for the EPA Administrator. Its stated purpose is to support

EPA leadership and activities. To implement policies that are consistent witha

conservative EPA, the agency will have to undergo a major reorganization. The

Deputy Chief of Staff for Policy position within the Administrator’s office should

be renamed the Deputy Chief of Staff for Regulatory Improvement. This position

would oversee a reorganization effort that includes the following actions:

Returning the environmental justice function to the AO, eliminating the
stand-alone Office of Environmental Justice and External Civil Rights.

Returning the enforcement and compliance function to the media offices
(air, water, land, and emergency management, etc.) and eliminating the
stand-alone Office of Enforcement and Compliance Assistance, which has
created a mismatch between standard-setting and implementation.

Using enforcement to ensure compliance, not to achieve
extrastatutory objectives.

Developing a plan for relocating regional offices so that they are
more accessible to the areas they serve and deliver cost savings to the
American people.

Restructuring the Office of International and Tribal Affairs into the
American Indian Environmental Office and returning the international
liaison function to media offices where appropriate.

Eliminating the Office of Public Engagement and Environmental Education
as a stand-alone entity and reabsorbing substantive elements into the Office
of Public Affairs.

Relocating the Office of Children’s Health Protection and the Office of Small
and Disadvantaged Business Utilization from the AO and reabsorbing
those functions within the media offices (air, water, land, and emergency
management, etc.).

Reviewing the grants program to ensure that taxpayer funds go to

organizations focused on tangible environmental improvements free from
political affiliation.

— 421 —

Mandate for Leadership: The Conservative Promise

Resetting science advisory boards to expand opportunities for a diversity of
scientific viewpoints free of potential conflicts of interest.

Restoring the guidance portal to ensure that regulatory and subregulatory
standards are clear to affected entities.

Working with Assistant Administrators to implement major reforms in
media offices.

Day One Executive Order. To initiate the review and reorganization, a Day

One executive order should be drafted for the incoming President with explicit

language requiring reconsideration of the agency’s structure with reference to

fulfilling its mission to create a better environmental tomorrow with clean air, safe

water, healthy soil, and thriving communities. The order should set up “pause and

review” teams to assess the following:

Major Rules and Guidance Materials. Identify existing rules to be stayed
and reproposed and initiate rule development in appropriate media offices.

Pending Petitions. Grant new petitions for rule reconsideration and
stays of rules.

Grants. Stop all grants to advocacy groups and review which potential
federal investments will lead to tangible environmental improvements.

Legal Settlements. Reassess any “sue and settle” cases and develop a
new policy to establish standard review and oversight, including public
notification and participation.

Employee Review. Determine the opportunity to downsize by
terminating the newest hires in low-value programs and identify relocation
opportunities for Senior Executive Service (SES) positions.

Budget Review. Develop a tiered-down approach to cut costs, reduce the
number of full-time equivalent (FTE) positions, and eliminate duplicative
programs. EPA should not conduct any ongoing or planned activity for
which there is not clear and current congressional authorization, and it
should communicate this shift in the President’s first budget request.

Risk Management Policy. Revise guidance documents that control
regulations such as the social cost of carbon; discount rates; timing of

— 422 —

2025 Presidential Transition Project

regulatory review (before options are selected); causality of health effects;
low-dose risk estimation (linear no-threshold analysis); and employment
loss analysis.

Personnel

The majority of the political appointee team must be assembled, vetted, and
ready to deploy before Day One. To the extent provided by the Federal Vacan-
cies Reform Act,” appointees in consideration for Senate-confirmed positions
(excluding the Administrator) should be prepared to serve as a Deputy or Principal
Deputy to get into the agency on Day One while their nomination and affiliated
confirmation processes proceeds. In addition to a deputy slated for the Assistant
Administrator role, each office will need a political chief of staff, senior advisers
designated to run suboffices, and energized assistants. Teams should be balanced
with technical knowledge, legal expertise, and political exposure. Ideally, they
should also be geographically diverse. Appointee positions should also extend to
all the regional offices and specialty labs.

OFFICE OF AIR AND RADIATION (OAR)

OAR develops national programs, policies, and regulations to control air
pollution and radiation exposure. In recent decades, OAR and its statutory respon-
sibilities under the Clean Air Act have been reimagined in an attempt to expand
the reach of the federal government. The U.S. Supreme Court has stopped and
stricken several actions from OAR under liberal Administrations, citing a lack of
requisite legal support. A reformed OAR should focus on EPA’s mission of limiting
and minimizing criteria and hazardous air pollutants in partnership with the states.

Cross-Cutting Reforms. OAR consists of four suboffices with two located in
Washington, D.C.; one in Ann Arbor, Michigan; and one at Research Triangle Park
in Raleigh, North Carolina. The following reforms should be implemented across
all OAR offices:

e Issue arule to ensure consistent and transparent consideration of costs.

e When doing cost-benefit analysis, use appropriate discount rates, focus

on the benefits of reducing the pollutant targeted by Congress, identify

“co-benefits” separately, and acknowledge the uncertainties involved in
quantifying benefits.

e Review and revise Reasonably Available Control Technology (RACT)
cost guidance to ensure that calculations are accurate and reflect the
actual regulatory burden, including costs of air rules implementation
and compliance.

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Obey Congress’s direction in CAA § 321'° to “conduct continuing
evaluations” of the employment and plant-closure effects of air regulations.

Ensure that all provisions of CAA § 307(d)” are observed. Congress placed
special constraints on air rules, and that intent should be respected.

To the extent that the Inflation Reduction Act (RA)"* remains in place,
ensure to the maximum extent possible that grants and funding are
provided to state regulatory entities and not to nonprofits.

Remove any regulations or requirements that confer on third parties
any authorities that have been provided to EPA, such as the oil and gas
supplemental, which created a Super-Emitter Response Program that
allows third parties to act as EPA enforcers.

Policy-Specific Actions

National Ambient Air Quality Standards (NAAQS)

EPA adopted by regulation a goal of restoring natural visibility by 2064. The
statute does not require this, and EPA should consider whether a longer
timeline is less disruptive or more realistic. Regional haze rules should be
revised to prevent subsequent “planning periods” from being abused to
compel the shutdown of disfavored facilities.

Under the Good Neighbor Program/Interstate pollutant transport
program, review Biden-era regulations to ensure that they do not
“overcontrol” upwind states in violation of the statute as construed by
the U.S. Supreme Court. Reverse the program’s 2022 expansion beyond
power plants.

Putting guardrails on downwind states is an abuse of the CAA § 126(b)””
petition process. EPA must ensure, in keeping with statutory text, that
petitions identify a reasonably discrete “group” of upwind sources alleged to
violate the good neighbor provision.

Ensure that the Clean Air Scientific Advisory Committee (CASAC) considers
all of the statutorily charged factors (for example, social and economic

effects resulting from NAAQS attainment and maintenance strategies).

Ensure that the requirements EPA puts on a state that has achieved
attainment status from nonattainment status are limited to those that

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are statutorily required, and remove any regulatory differences between
attainment and maintenance that are not explicitly required by law.

e Streamline the process for state and local governments to demonstrate
that their federally funded highway projects will not interfere with
NAAQS attainment.

e Adopt policies to prevent abuse of EPA’s CAA “error correction”
authority.”° EPA historically has used this to coerce states into
adopting its favored policies on pain of imposition of a Federal
Implementation Plan (FIP).

e Limit EPA’s reliance on CAA § 301”! general rulemaking authority to ensure
that it is not abused to issue regulations for which EPA lacks substantive
authority elsewhere in the statute.

e If possible, return the standard-setting role to Congress.
Climate Change
e Remove the Greenhouse Gas Reporting Program (GHGRP) for any source
category that is not currently being regulated. The overall reporting
program imposes significant burdens on small businesses and companies
that are not being regulated. This is either a pointless burden or a sword-of-

Damocles threat of future regulation, neither of which is appropriate.

e Establish a system, with an appropriate deadline, to update the 2009
endangerment finding.

e Establish a significant emissions rate (SER) for greenhouse gasses (GHGs).

Regulating Hydrofluorocarbons (HFCs) Under the American Innovation
and Manufacturing (AIM) Act”

e Repeal Biden Administration implementing regulations for the AIM Act
that are unnecessarily stringent and costly.

e Refrain from granting petitions from opportunistic manufacturers to add

new restrictions that further skew the market toward costlier refrigerants
and equipment.

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Mandate for Leadership: The Conservative Promise

Conduct realistic cost assessments that reflect actual consumer experiences
instead of the current unrealistic ones claiming that the program is
virtually cost-free.

Mobile Source Regulation by the Office of Transportation and Air Quality

Establish GHG car standards under Department of Transportation (DOT)
leadership that properly consider cost, choice, safety, and national security.

Review the existing “ramp rate” for car standards to ensure that it is
actually achievable.

Include life cycle emissions of electric vehicles and consider all of their
environmental impacts.

Restore the position that California’s waiver applies only to California-
specific issues like ground-level ozone, not global climate issues.

Ensure that other states can adopt California’s standards only for
traditional/criteria pollutants, not greenhouse gases.

Stop the use of the International Civil Aviation Organization (ICAO) to
increase standards on airplanes.

Reconsider the Cleaner Trucks Initiative to balance the goal of driving
down emissions without creating significant costs or complex burdens on

the industry.

Air Permitting Reforms for New Source Review (Pre-Construction Per-

mits) and Title V (Operating Permits)

Develop reforms to ensure that when a facility improves efficiency within its
production process, new permitting requirements are not triggered.

Restore the Trump EPA position on Once-In, Always-In (that major sources
can convert to area sources when affiliated emissions standards are met).

Revisit permitting and enforcement assumptions that sources will operate

24 hours a day, 365 days a year; this artificially inflates a source’s potential to
emit (PTE), which can result in more stringent permit terms.

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Defend the position that petitions to object to Title V should not be used to
second-guess previous state decisions.

Clarify the relationship between New Source Review and Title V to ensure
that Title V is used only as intended by Congress.

CAA Section 111”

Restore the position that EPA cannot regulate a new pollutant from an
already regulated source category without making predicate findings for
that new pollutant.

Institute automatic withdrawal of any proposed rule that is not finalized
within the statutorily prescribed one-year period.

Revise general implementing regulations for existing source regulatory
authority under CAA § 111(d)* to ensure that EPA gives full meaning to
Congress’s direction, including source-specific application, and that the
state planning program is flexible, federalist, and deferential to the states.

CAA Section 112 (Hazardous Air Pollutants)**
Unregulated point or non-point source (fugitive emissions) of an already
regulated hazardous air pollutant do not require a Maximum Available

Control Technology (MACT) standard.

Ensure that Section 112 regulations are harmonized with Section 111
regulations that apply to the same sector/sources.

Ensure that cost-benefit analysis is focused on a regulation’s targeted
pollutant and separately identify ancillary or co-benefits.

Radiation
Assess and update the agency’s radiation standards so that they align with
those of other agencies, including the Nuclear Regulatory Commission,
Department of Energy, and Department of Transportation, as well as

international standards.

Level-set past, misleading statements regarding radiological risk and
reassess the Linear Non-Threshold standard.

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Mandate for Leadership: The Conservative Promise

Personnel, Budget, and Office Restructuring

e Place a political appointee in Ann Arbor, Michigan, for the Office of
Transportation and Air Quality (OTAQ, regulating mobile sources) and
a political appointee in Research Triangle Park, North Carolina, for the
Office of Air Quality Planning and Standards (OAQPS, regulating stationary
sources) and give those appointees the requisite titles and authority to
oversee the OTAQ and OAQPS staff.

e Establish a political Chief of Staff in D.C. to manage the entire air office.

e Pull the Renewable Fuel Standard (RFS) program out of OTAQ; establish
its own suboffice in D.C. (with status parallel to OTAQ and OAQPS) that
is headed by a political appointee; and establish a Memorandum of
Understanding with the Department of Agriculture and the Department of
Energy to work together to establish RFS programs.

e Require regional air offices to receive approval from OAR before moving
forward with enforcement actions in order to ensure that enforcement
is meeting the requirements established by regulations and is not going
beyond them.

OFFICE OF WATER (OW)

OW is responsible for ensuring safe drinking water and restoring and main-
taining oceans, watersheds, and their aquatic ecosystems to protect human health,
support economic and recreational activities, and provide healthy habitats for fish,
plants, and wildlife. Its two main statutes include implementing the Clean Water
Act (CWA)” and Safe Drinking Water Act (SDWA).”’ OW has generated a large
number of expansive regulations that infringe on private property rights, most
notably with the Waters of the U.S. program.

Needed Reforms
The overarching theme for reform is guidance on guidance. OW relies heav-
ily on guidance documents that are outdated and that sometimes have been ina
“deliberative” state for years. Additionally, there are significant issues surrounding
OW’s holding up guidance as something more than simply guidance: as something
akin to law in certain circumstances. The August 6, 2019, “Office of Water Policy for
Draft Documents” memorandum” should be strictly enforced to ensure transpar-
ency as well as good governance by not letting guidance linger in draft form and
by also ensuring that guidance documents are clearly just that: guidance. They do
not have the effect of law and should not be treated by the office as if they did have
any such effect.

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As a matter of broad practice, OW should be complying with statutorily estab-

lished deadlines in all situations with only minimal exceptions. In cases where

statutory deadlines will not be met, senior management should be made aware

of the delay and should have an opportunity to determine whether alternative

courses should be taken.

Depending on the outcome of regulations from the Biden Administration as

well as intervention by the Supreme Court on both waters of the United States
(WOTUS) and CWA Section 401,”’ the repeal and reissuance of new regulations
should be pursued.

New Policies

New regulations should include the following:

A WOTUS rule that makes clear what is and is not a “navigable water” and
respects private property rights. Coordinate with Congress to develop
legislation, if necessary, to codify the definition in Rapanos v. United States
that “waters of the United States” can refer only to “relatively permanent,
standing or continuously flowing bodies of water...as opposed to ordinarily
dry channels through which water occasionally or intermittently flows.”*°

Arule that provides clarity and regulatory certainty regarding the CWA
Section 401 water quality certification process to limit unnecessary delay for
needed projects, including by establishing a discharge-only approach with

a limited scope (from point sources into navigable waters), assessing only
water quality factors that are consistent with specific CWA sections, and
excluding speculative analysis regarding future potential harm.

Arule to ensure that CWA Section 308*' has a clear and enforced time limit.

Arule to clarify the standard for criminal negligence under CWA Sections
402* and 404.°°

Arule to prohibit retroactive or preemptive permits under CWA Section 404.

Arule to promote and shape nutrient trading that utilizes a carrot-versus-
stick approach when dealing with nutrient compliance.

Arule to update compensatory mitigation that imposes no new or additional
requirements beyond current law.

Arule on updates necessary for the effective use of the CWA needs survey.

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Mandate for Leadership: The Conservative Promise

e Anexecutive order requiring EPA to find avenues and expedite the process
for states obtaining primacy in available CWA and SDWA programs. This
order would require coordination with the Army Corps of Engineers and the
Department of the Interior.

e Implementation of additional policies to address challenges in water
workforce, issues surrounding timely actions on primacy applications, and
cybersecurity.

Budget

While the overall goal is certainly to reduce government spending, there is one
very targeted area where increased spending would be in the nation’s interest. The
Clean Water Act needs survey is the entire basis for how congressionally appro-
priated funds directed to state revolving funds—standard annual appropriations
that are the true underpinning of all infrastructure funding for drinking water and
clean water—are distributed by EPA across the country. Because this program is
currently underfunded, money is being thrown at untargeted locations while water
infrastructure is crumbling at other locations. Increased targeted funding would
greatly benefit water systems across the country at a time when intervention is
crucial, leaving fewer communities with significant water service challenges.

Personnel
OW would benefit greatly from the reshifting of SES employees to different
programs and from headquarters out to regional offices.

OFFICE OF LAND AND EMERGENCY MANAGEMENT (OLEM)

OLEM’s mission is to partner with other federal agencies, states, tribes, local
governments, and communities to clean up legacy pollution and revitalize land
for reuse. OLEM executes this mission by protecting human health and the envi-
ronment while leveraging economic opportunities and creating jobs. OLEM also
oversees the agency’s emergency response. The main statutes that OLEM exe-
cutes are the Resource Conservation and Recovery Act (RCRA)* to regulate waste
management; the Comprehensive Environmental Response, Compensation, and
Liability Act (CERCLA)* to clean up Superfund sites and provide resources for
cleaning up brownfields sites; and Section 112(r) of the Clean Air Act* to reduce
the likelihood of accidental chemical releases.

Needed Reforms

OLEM’s main function is to oversee the execution of cleanups under CERCLA
and RCRA; therefore, it is critical that OLEM staff focus on project management
more than policy creation. Emphasizing productivity more than process and policies

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2025 Presidential Transition Project

can result in more work on the ground in communities where Americans live and

work. OLEM can accomplish this goal by determining the scope of work based on

an actual reduction in exposure to chemicals as opposed to the elimination of the-
oretical potential exposures. To manage cleanups more effectively, OLEM should:

e Require training in project management for project managers (as opposed
to all staff having a general science background).

e Adopt EPA’s Lean Management System (ELMS) across all OLEM programs.

e Delegate all CERCLA authority from the Administrator to the OLEM
Assistant Administrator as opposed to a direct delegation to the Regional
Administrators.

e Find opportunities to transfer work and funding to states and tribes.

New Policies

Superfund. To execute more efficient and effective cleanups, the following
changes are needed in the Office of Superfund Remediation and Technology Inno-
vation (OSRTD:

e Revise the National Oil and Hazardous Substances Pollution Contingency
Plan (NCP) to modernize and streamline the cleanup process using lessons
learned from the execution of the NCP over the past 40-plus years.

e Increase the use of CERCLA removal authority to execute short-term
cleanups, which will provide clarity and finality for potentially responsible
parties (PRPs) and return cleaned up land to communities more swiftly.

e Streamline the process for determining Applicable or Relevant and
Appropriate Requirements based on commonalities across sites as opposed

to making such determinations on a site-by-site basis.

e Revise groundwater cleanup regulations and policies to reflect the
challenges of omnipresent contaminants like PFAS.

e Revisit the designation of PFAS chemicals as “hazardous substances”
under CERCLA.

e Allow PRPs to perform the statutorily required five-year reviews of
Superfund cleanups to free OLEM resources.

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Mandate for Leadership: The Conservative Promise

Expand and fully stand up the Office of Mountains, Deserts and Plains to
support innovative approaches to the cleaning up of abandoned mines.

Develop and execute a 10-year cleanup plan to address lead at all existing
cleanup sites that includes benchmarks and milestones that allow for
congressional and public oversight of the schedule.

RCRA. To streamline waste management, the following changes are needed in
the Office of Resource Conservation and Recovery (ORCR):

Create an RCRA post-closure care permit that is tailored only to post-
closure obligations.

Modify regulations that impede resource efficiency, recycling, and
reuse by providing clearly that these materials are not waste. This can
be done by promulgating a rule that provides an alternative pathway
to hazardous waste regulation to allow the transport of material to
legitimate recyclers or back to manufacturers to support the recycling
and reuse of material.

Change the electronic manifest (e-manifest) regulations to a 100 percent
electronic system and eliminate all paper manifests and manual filing and
data input. This system should operate from a range of common handheld
devices and could be expanded to accommodate solid waste and materials
for reuse and recycling.

Reassign regulation and enforcement of air emission standards under the
authority of RCRA Section 3004” to OAR and revise and modernize the
regulations to comport and integrate with CAA rules.

Risk Management Program. If anew Risk Management Program (RMP) rule

is finalized by the Biden Administration, it should be revised to reflect the amend-

ments finalized in 2019 to protect sensitive information.

Personnel

The following organizational changes could create resource efficiencies to focus

on the highest-value opportunities:

Eliminate or consolidate the regional laboratories and allow OLEM to use
EPA, other government, or private labs based on expertise and cost.

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2025 Presidential Transition Project

e Consolidate non-core functions (communications, economists,
congressional relations, etc.) into one OLEM suboffice to allow the subject-
matter offices to focus on the execution of field work.

e Eliminate the Office of Emergency Management and reassign its functions.

1. Move the emergency management function (currently OEM) into
Homeland Security under the Administrator’s office.

2. Incorporate removal authority (currently OEM) into OSRTI.

3. Retain the oversight and enforcement of the RMP program
within OLEM.

4. Drop “Emergency Management” from OLEM’s name.

Budget

While the overall goal is certainly to reduce government scope and spending,
OLEM’s programs present the best opportunity to use taxpayer dollars to execute
EPA’s core mission of cleaning up contamination.

OFFICE OF CHEMICAL SAFETY AND
POLLUTION PREVENTION (OCSPP)

OCSPP primarily oversees the regulation of new and existing chemicals under
the Toxic Substances Control Act (TSCA)* and the regulation of pesticides under
the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA)*” and Federal
Food, Drug, and Cosmetic Act (FFDCA).”° These activities are managed in two
separate offices within OCSPP: the Office of Pollution Prevention and Toxics (OPPT,
chemicals) and Office of Pesticide Programs (OPP, pesticides). OCSPP is constantly
pressured to ban the use of certain chemicals, typically based on fear as a result of
mischaracterized or incomplete science.

Needed Reforms and New Policy in OPPT (Chemicals)

e Ensure that decision-making is risk-based rather than defaulting to
precautionary, hazard-based approaches like the Integrated Risk
Information System (IRIS).

e Focus the scope of chemical evaluations on pathways of exposure that are
not covered by other program offices and other environmental statutes, and
eliminate scope creep to ensure that evaluations can be completed ina
timely manner consistent with the statutory requirements.

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Mandate for Leadership: The Conservative Promise

Ensure that new chemical evaluations are conducted in a timely manner,
consistent with statutory requirements, to ensure the competitiveness of
U.S. manufacturers.

For new chemicals, reset the program to ensure that reviews are completed
on a timeline that is consistent with the statute. This includes revising the
regulations governing the reviews of new chemicals.

Ensure that risk evaluations and risk management rules presume that
workplaces are following all OSHA requirements, including requirements
for personal protective equipment (PPE).

Apply real-world use of chemicals when assessing conditions of use for risk
evaluations.

Transition the Safer Choice program to the private sector.
Right-size the TSCA fee’s rule so that it is consistent with the tasks that the
agency is actually completing within the timelines of the statute and is not

covering the costs of EPA inefficiency or overreach.

Revise existing policies to address the requirements of the 2016 Lautenberg
amendments to the TSCA”

Develop a framework rule for risk management approaches that will be used
under TSCA for existing chemicals.

Needed Reforms and New Policy in OPP (Pesticides)

OPP should rely on Department of Agriculture and state usage data that
reflect actual pesticide use in registration reviews and Endangered Species
Act (ESA)* analyses. The U.S. Fish and Wildlife Service and National Marine
Fisheries Service should rely on similar data in their ESA analyses.

OPP has rigorous testing requirements that registrants must meet before
pesticides are allowed on the market. However, when pesticides undergo
registration review every 15 years, EPA relies on publicly available data with
differing levels of quality and transparency. Data standards are needed to
ensure that information relied on by EPA is made available to the agency at
a similar level as the original testing data conducted by registrants to ensure
that EPA can conduct a robust review and analysis of the data.

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2025 Presidential Transition Project

e ESA reform for pesticides is necessary. When approving pesticides, FIFRA
allows for cost-benefit balancing, recognizing that pesticides are effective
precisely because they harm pests. However, the ESA does not allow for
any consideration of the beneficial effects of pesticides. In order to meet
ESA obligations, pesticide uses are severely restricted, leaving growers with
limited tools for crop protection.

e New policies are needed to ensure that other program offices (such as ORD,
OW, and OLEM) will defer to OPP on toxicity issues. OPP has rigorous
testing requirements for pesticide ingredients and products to ensure
before they go to market that their use will not harm human health and the
environment. Assessments by other offices are redundant.

e While individual pesticide registrations are considered adjudications and not
reviewed by the Office of Management and Budget (OMB), consistent with a
1993 OMB guidance, when pesticide tolerances and registrations are withdrawn
by the agency (as opposed to being withdrawn voluntarily by registrants), these
actions should undergo coordinated interagency review managed by OMB.

Budget

The Biden Administration has expanded the scope and breadth of regulatory
actions with respect to OPPT and OPP, but both programs continue to maintain
that resources are insufficient.

OPPT (chemicals) suffers from a lack of leadership and an inability to complete
the most basic requirements efficiently and in a timely fashion. While EPA has
asked for more resources, including higher industry fees, it is not clear that it has
the capacity to use additional dollars efficiently.

With regard to OPP (pesticides), pesticide manufacturers feel that the program
is underfunded and would like its budget to be increased so that pesticide actions
can be reviewed more quickly. Manufacturers are also willing to pay higher fees
to the fee-based portion of the program. However, grower groups have been dis-
appointed by EPA’s actions and have significant concerns about EPA’s ability to
conduct science-based risk assessments and take risk management actions that
appropriately balance benefits and risks as required by FIFRA. Guardrails and
third-party audits should be part of any funding increases through the Pesticide
Registration Improvement Act (PRIA)* or other mechanisms.

OFFICE OF RESEARCH AND DEVELOPMENT (ORD)
AND RELATED SCIENCE ACTIVITIES

While much of this work has not been authorized by law, EPA conducts a wide
variety of intramural and extramural research, development, regulatory science,

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Mandate for Leadership: The Conservative Promise

science advisory, peer review, risk assessment, and risk management activities. This
enterprise includes the Office of Research and Development (ORD), the agency’s
largest employer, as well as science activities across other key programs, regions,
and cross-cutting parts of the Administrator’s office. EPA’s scientific enterprise,
including ORD, has rightly been criticized for decades as precautionary, bloated,
unaccountable, closed, outcome-driven, hostile to public and legislative input, and
inclined to pursue political rather than purely scientific goals.

Needed Reforms: Day One Priorities

e Notify Congress that EPA will not conduct any ongoing or planned science
activity for which there is not clear and current congressional authorization.
This priority should be underscored in the President’s first budget request.

e The new President’s Inauguration Day regulatory review/freeze directives
should avoid exceptions for EPA actions. This freeze should explicitly
include quasi-regulatory actions, including assessments, determinations,
standards, and guidance, that have failed to go through the notice-and-
comment process and may date back years.

e Pause for review all contracts above $100,000 with a heavy focus on major
external peer reviews and regulatory models.

e Call for the public to identify areas where EPA has inconsistently assessed
risk, failed to use the best science, or participated in research misconduct.

e Eliminate the use of unauthorized regulatory inputs like the social cost of
carbon, black box and proprietary models, and unrealistic climate scenarios,
including those based on Representative Concentration Pathway (RCP) 8.5.

Personnel
e Quickly nominate a reform-minded Assistant Administrator for Research
and Development.

e Appoint and empower a Science Adviser reporting directly to the
Administrator in addition to a substantial investment (no fewer than
six senior political appointees) charged with overseeing and reforming
EPA research and science activities. Qualifications for these positions
should emphasize management, oversight, and execution skills Gncluding
in leading state environmental agencies) as opposed to personal
scientific output.

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e Suspend and review the activities of EPA advisory bodies, many of which
have not been authorized by Congress or lack independence, balance, and
geographic and viewpoint diversity.

e Retract delegations for key science and risk-assessment decisions from
Assistant Administrators, regional offices, and career officials.

e Eliminate the use of Title 42 hiring authority that allows ORD to spend
millions in taxpayer dollars for salaries of certain employees above the civil
service scale.

e Announce plans to streamline and reform EPA’s poorly coordinated and
managed laboratory structure.

Budget: Back-to-Basics Rejection of Unauthorized
or Expired Science Activities

A top priority should be the immediate and consistent rejection of all EPA
ORD and science activities that have not been authorized by Congress. In FY
2022, according to EPA’s opaque budgeting efforts, science and technology activ-
ities totaled nearly $730 million. EPA’s FY 2023 budget request for the Office of
Research and Development seeks funds for more than 1,850 employees—a dramatic
increase for what is already the largest EPA office with well above 10 percent of
the agency’s workforce.** ORD conducts a wide-ranging series of science and peer
review activities, some in support of regulatory programs established by our envi-
ronmental laws, but often lacks authority for these specific endeavors.

Several ORD offices and programs, many of which constitute unaccountable
efforts to use scientific determinations to drive regulatory, enforcement, and legal
decisions, should be eliminated. The Integrated Risk Information System, for
example, was ostensibly designed by EPA to evaluate hazard and dose-response for
certain chemicals. Despite operating since the 1980s, the program has never been
authorized by Congress and often sets “safe levels” based on questionable science
and below background levels, resulting in billions in economic costs. The program
has been criticized by a wide variety of stakeholders: states; Congress; the National
Academies of Science, Engineering, and Medicine (NASEM); and the U.S. Govern-
ment Accountability Office (GAO), among others. EPA has failed to implement
meaningful reforms, and this unaccountable program threatens key regulatory
processes as well as the integrity of Clean Air Act and TSCA implementation.

Needed EPA Advisory Body Reforms

EPA currently operates 21 federal advisory committees.** These committees
often play an outsized role in determining agency scientific and regulatory policy,

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Mandate for Leadership: The Conservative Promise

and their membership has too often been handpicked to achieve certain politi-
cal positions. In the Biden Administration, key EPA advisory committees were

purged of balanced perspectives, geographic diversity, important regulatory and

private-sector experience, and state, local, and tribal expertise. Contrary to con-
gressional directives and recommendations from the GAO and intergovernmental

associations, these moves eviscerated historic levels of participation on key com-
mittees by state, local, and tribal members from 2017 to 2020. As a result, a variety
of EPA regulations lack relevant scientific perspectives, increasing the risks of
economic fallout and a failure of cooperative federalism. EPA also has repeatedly
disregarded legal requirements regarding the role of these advisory committees

and the scope of scientific advice on key regulations.*®

Needed Science Policy Reforms

Instead of allowing these efforts to be misused for scaremongering risk com-
munications and enforcement activities, EPA should embrace so-called citizen
science and deputize the public to subject the agency’s science to greater scrutiny,
especially in areas of data analysis, identification of scientific flaws, and research
misconduct. In addition, EPA should:

e Shift responsibility for evaluating misconduct away from its Office of
Scientific Integrity, which has been overseen by environmental activists,
and toward an independent body.

e Work (including with Congress) to provide incentives similar to those under
the False Claims Act*’ for the public to identify scientific flaws and research
misconduct, thereby saving taxpayers from having to bear the costs involved
in expending unnecessary resources.

e Avoid proprietary, black box models for key regulations. Nearly all major
EPA regulations are based on nontransparent models for which the
public lacks access or for which significant costs prevent the public from
understanding agency analysis.

e Reject precautionary default models and uncertainty factors. In the face
of uncertainty around associations between certain pollutants and health
or welfare endpoints, EPA’s heavy reliance on default assumptions like its
low-dose, linear non-threshold model bake orders of magnitude of risk
into key regulatory inputs and drive flawed and opaque decisions. Given
the disproportionate economic impacts of top-down solutions, EPA should
implement an approach that defaults to less restrictive regulatory outcomes.

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Refocus its research activities on accountable real-world examinations

of the efficacy of its regulations with a heavy emphasis on characterizing
and better understanding natural, background, international, and
anthropogenic contributions for key pollutants. It should embrace concepts
laid out in the 2018 “Back-to-Basics Process for Reviewing National
Ambient Air Quality Standards” memo* to ensure that any science and risk
assessment for the NAAQS matches congressional direction.

Legislative Reforms

While some reforms can be achieved administratively (especially in areas where

EPA clearly lacks congressional authorization for its activities), Congress should

prioritize several EPA science activity reforms:

Use of the Congressional Review Act for Congress to disapprove of EPA
regulations and other quasi-regulatory actions and prohibit “substantially
similar” actions in the future.

Reform EPA’s Science Advisory Board and other advisory bodies to ensure
independence, balance, transparency, and geographic diversity.

Build on recent bipartisan proposals to increase transparency for
advisory bodies, subject to the Federal Advisory Committee Act*® as well
as recommendations from the Administrative Conference of the U.S., to
strengthen provisions for independence, accountability, geographic
diversity, turnover, and public participation. This should include a
prohibition on peer review activities for unaccountable third parties
that lack independence or application of these same principles to non-
governmental peer review bodies (including NASEM).

Add teeth to long-standing executive orders, memoranda, recommendations,
and other policies to require that EPA regulations are based on transparent,
reproducible science as well as that the data and publications resulting from
taxpayer-funded activities are made immediately available to the public.

Reject funds for programs that have not been authorized by Congress
(like IRIS) as well as peer review activities that have not been authorized
by Congress.

Revisit and repeal or reform outdated environmental statutes. A high

priority should be the repeal or reform of the Global Change Research Act of
1990,°° which has been misused for political purposes.

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Mandate for Leadership: The Conservative Promise

e Repeal Inflation Reduction Act programs providing grants for
environmental science activities.

AMERICAN INDIAN OFFICE (AIO)

AIO is a vital EPA function. It is mandated to carry out a1992 act of Congress
that administers the Indian Environmental General Assistance Program.*' Because
of the sovereign-to-sovereign relationship between the U.S. government and fed-
erally recognized sovereign Indian nations, this act’s purpose is to assist tribes
in developing the capacity to manage their own tribal environmental protection
programs and set them up to implement programs for the management of solid
and hazardous waste. This office also is the chief office under which the EPA’s 1984
Indian Policy functions.

Needed Reforms

AIO should be significantly elevated as a stand-alone EPA Assistant Admin-
istrator office. This would send a clear message to American Indians and Alaska
Native Villages that the agency takes seriously the environmental issues plaguing
Indian Country. While designated a “headquarters” office with direct reporting
to the Administrator, its location should be in the American West, closer to most
tribal nations. This could include Oklahoma City, Oklahoma; Dallas, Texas; or
Denver, Colorado. The state of Oklahoma is considered the tribal center of Amer-
ica and is home to 39 federally recognized tribes, including the “Five Civilized
Tribes.” The other two options are also close to numerous tribes and home to EPA
regional offices.

New Policies
All EPA tribal grants and tribal matters should be run from this office as a one-
stop-shop for all tribal affairs.

Budget and Personnel

AIO should be led by a politically appointed, Senate-confirmed Assistant Admin-
istrator, ideally one with strong ties to a federally recognized tribe. He or she should
have political deputies and staff to assist the political leadership in carrying out
agency policies.

Career EPA tribal staff are located throughout the nation in all regional offices
but are paid mostly under the budget of the current Office of International and
Tribal Affairs, which will be significantly restructured as international functions
are reabsorbed into the appropriate media offices (for example, Air, Water, and
Land and Emergency Management). Because of this, tribal staff should be fully
under the authority of the new American Indian Office and its Assistant Admin-
istrator, not the regional offices.

— 440 —

2025 Presidential Transition Project

OFFICE OF GENERAL COUNSEL (OGC)

OGC serves as the chief legal adviser to EPA’s policymaking officials. It also pro-

vides legal support to regional actions and enforcement and compliance litigation.

OGC lawyers represent the agency in court alongside the Department of Justice,

typically defending agency actions.

Needed Reforms and New Policies

Review EPA’s Environmental Justice and Title VI authority.
Wherever possible, the Biden Administration is broadening EPA’s use and
interpretation of Environmental Justice (EJ)*? and Title VI of the Civil
Rights Act of 1964°* beyond long-standing understandings of the legal limits
of that authority. As a threshold matter, there is an opportunity to redefine
EJ as a tool for the agency to prioritize environmental protection efforts
and assistance to communities in proximity to pollution or with the greatest
need for additional protection. Allocations of agency resources, increased
EPA enforcement, and/or agency distribution of grants should be based on
neutral constitutional principles.

In 2023, the Supreme Court is expected to provide guidance on the
constitutionality of race-based discrimination as it considers Students for
Fair Admissions v. University of North Carolina. Accordingly, the next
Administration should pause and review all ongoing EJ and Title VI actions
to ensure that they are consistent with any forthcoming SCOTUS decision.

Establish a policy of legally speaking with one voice. Some EPA offices
(for example, the Office of Enforcement and Compliance Assurance and the
Offices of Regional Counsel) assert legal positions and interpretations of
the law that conflict with an Administration’s interpretation as articulated
by OGC with input from program offices. It is unacceptable for the agency
to have inconsistent legal positions, particularly with respect to key
interpretative issues. All attorneys with authority to represent EPA—not
necessarily all attorneys—should therefore be housed in OGC. These

offices include:

1. The Office of Enforcement and Compliance Assurance (OECA).
OECA was established during the Clinton Administration. Enforcement
attorneys tend to take legal positions to win cases or obtain settlements
that may be inconsistent with those of OGC and program offices. OECA
attorneys should be moved into OGC. Additionally, non-attorney
program staff in OECA could be moved into their relevant program
offices (for example, the Clean Air Act Enforcement Advisor could

—441—-

Mandate for Leadership: The Conservative Promise

be moved into OAR). Beyond the avoidance of inconsistent legal
positions, this policy would reduce the agency’s overall expenditures
and duplication of work. To accommodate this new function, OGC could
establish a new Deputy General Counsel for Enforcement position to
manage the enforcement attorneys at headquarters and in the regions.

The Office of Congressional and Intergovernmental Affairs
(OCIR). OCIR employees should not take legal positions. In all
Administrations, White House Counsel is key with respect to oversight
issues and has an important relationship with OGC. There must bea
strategic relationship between OCIR and OGC, but OGC, in consultation
with agency clients and White House Counsel, should assert EPA legal
positions to Congress (for example, the assertion of interests regarding
congressional subpoenas, witness availability and testimony, and
document production).

The Office of Environmental Justice and External Civil Rights
(OEJECR). OEJECR was established during the Biden Administration.
EJ and civil rights functions were taken from OGC and moved into

a stand-alone office as well as spread through the regions. OEJECR
should be disbanded; OEJECR’s attorneys should be moved back into
OGC; and nonlegal staff (for example, EJ Policy Advisers) should be
moved back into the Administrator’s office as is customary.

The Offices of Regional Counsel (ORCs). Regional EJ staff efforts,
both in the ORCs and in the policymaking offices, are highly variable.
EPA is therefore likely to take inconsistent legal positions. To the
extent that legal positions are taken by the ORCs and/or regional staff,
they should be coordinated and approved by OGC and the appropriate
regional leadership. For example, nearly all regional offices have EJ
Action Plans and/or EJ Implementation Plans. Region 1’s EJ Action
Plan is six pages, and Region 2’s is 66 pages. The Region 2 EJ Action Plan,
for example, specifies that “ORC will conduct EJ training for all legal
staff...to provide attorneys with a simple standard EJ analysis they can
use regardless of the context—enforcement, grants, permits, referrals,

etc.—of the case.”*°

In addition, EPA should refrain from publicly undermining the National

Environmental Policy Act (NEPA)* process at other agencies and should

instead focus on providing constructive, technical support during the

interagency process.

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2025 Presidential Transition Project

Personnel
e Review OGC resources to consider reorganization of other attorney functions
and leadership for consolidation into a Cross-Cutting Issues Law Office.

e Review telework policies and attorneys with permanent duty stations not at
EPA headquarters or a regional office.

e Consider invoking the rotation of SES managers within OGC and ORCs to
other EPA offices where appropriate.

e Monitor all external communications conveying a legal position.

e Donotallow public events at which the agency puts forth its legal position
unless they are specifically approved (for example, agency webinars on
sensitive issues).

Budget
OGC’s budget will increase with consolidation of FTE funding that follows attor-
neys who come from other EPA offices.

e Reassess duplicative skill sets with the consolidation and allow for
attrition if needed.

e Consider allocated resources for regional recruiting to increase geographic
diversity from law schools from each state.

OFFICE OF MISSION SUPPORT (OMS)

OMS leads the agency’s core mission support functions to improve efficiency,
coordination, and customer experience for internal customers, stakeholders,
and the public, including protection of EPA’s facilities and other critical assets
nationwide, acquisition activities (contracts), grants management, human capital,
information technology, and information management activities.

Grant Reform

EPA now awards up to $30 billion in grants annually—up to half of the agen-
cy’s annual budget. Of these funds, $500 million is awarded as discretionary. This
grantmaking—discretionary and otherwise—is driven by ideology instead of
need. Of particular concern is a practice whereby numerous small-dollar grants
are administered to a great number of grantees while larger grants are given to
academic institutions. As a result, grant funds produce little to no meaningful
improvements in the environment and public health and instead fund questionably

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Mandate for Leadership: The Conservative Promise

relevant projects at elite, private academic institutions that invariably produce
radical environmental research.

Steps should be taken to ensure that grants are awarded based on need instead
of ideological affiliation or academic preference. Specifically, EPA should:

e Institute a pause and review for all grants over a certain threshold.

e Puta political appointee in charge of the grants office to prioritize
distribution of grants to those who are most in need and toward projects
that will tangibly improve the environment.

e Cap the number and dollar amounts of grants that the Office of Research
and Development can award and require that they be reviewed by the
Administrator’s office.

OFFICE OF THE CHIEF FINANCIAL OFFICER (OCFO)

OCFO formulates and manages EPA’s annual budget and performance plan,
coordinates EPA’s strategic planning efforts, develops EPA’s annual Performance
and Accountability Report, and implements the Government Performance and
Results Act.*”

Needed Reforms

EPA has been audited by the agency’s Inspector General for decades, well
beyond accepted norms for private-sector financial audits. Audit teams should be
diversified. Staffing assignments, especially at the senior level, should be reviewed
and streamlined, and the office should consolidate space to save agency costs. For
example, six offices need six security contracts to protect employees when one
contract would suffice.

New Policies
Review travel and reimbursement policies for best practices aligned for
industry norms.

Personnel

The Deputy Chief Financial Officer position is currently reserved for a career
official, but political appointees may serve as Associate CFO, Special Advisor, and
other senior officials. In addition to evaluating whether the Deputy Chief Finan-
cial Officer position should be reserved for a career official, anew Administration
should immediately fill these positions with political appointees and establish a
new political leadership position for Appropriations Liaison, which is currently
overseen by career employees.

— 444 -—

2025 Presidential Transition Project

Budget

OCFO is responsible for drafting and sharing the President’s budget with Con-
gress. The CFO often testifies along with the Administrator. Efforts to simplify the
budget request could improve the overall transparency and general understanding
of the agency’s work.

CONCLUSION

Amore conservative EPA that aligns with the policies outlined in this chapter
will lead to a better environmental future without unintended consequences. It
will prevent unnecessary expenditures by the regulated community, allowing for
investment in economic development and job creation, which are keys to thriving
communities. Cutting EPA’s size and scope will deliver savings to the American
taxpayer. Improved transparency will serve as an important check to ensure that
the agency’s mission is not distorted or coopted for political gain. Importantly, a
conservative EPA will deliver tangible environmental improvements to the Amer-
ican people in the form of cleaner air, cleaner water, and healthier soils.

AUTHOR'S NOTE: This chapter could not have been completed without the assistance of numerous policy
experts, legal professionals, and former appointees. A special note of thanks to David Harlow, Justin Schwab,
Aaron Szabo, Clint Woods, and Scott Mason IV. The author alone assumes responsibility for this chapter. No views
expressed herein should be attributed to any other individual.

—445—

Mandate for Leadership: The Conservative Promise

ENDNOTES

1. — Gabriella Hoffman, “Fact Check: Is Net Zero an Effective Policy for Stopping Climate Change?” Independent
Women’s Forum, October 31, 2022, https://www.iwf.org/2022/10/31/fact-check-is-net-zero-an-effective-
policy-for-stopping-climate-change/ (accessed January 25, 2023).

2. — Stephen Lee, Pat Rizzuto, Dean Scott, and Jennifer Hijazi, “EPA Would See Highest Funding Ever Under
Biden Budget Plan (2),” Bloomberg Law, March 28, 2022, https://news.bloomberglaw.com/environment-
and-energy/epa-would-see-highest-funding-level-ever-under-biden-budget-plan (accessed January 25,
2023). See also U.S. Environmental Protection Agency, United States Environmental Protection Agency Fiscal
Year 2023 Justification of Appropriation Estimates for the Committee on Appropriations, April 2022, https://
www.epa.gov/system/files/documents/2022-04/fy-2023-congressional-justification-all-tabs.pdf (accessed
March 20, 2023).

3. — William Yeatman, “EPA’s Missed Deadlines Cause Widespread Dysfunction,” Competitive Enterprise Institute
Blog, August 3, 2016, https://cei.org/blog/epas-missed-deadlines-causing-widespread-dysfunction/
(accessed January 25, 2023).

4, Shannon Osaka, “The EPA Failed Flint. Now We Know Exactly How,” Grist, July 19, 2018, https://grist.org/
article/the-epa-failed-flint-now-we-know-exactly-how/ (accessed January 25, 2023).

5. Alan Neuhauser, “EPA to Blame for ‘Preventable’ Gold King Mine Spill,” US News & World Report, October 22,
2015, https://www.usnews.com/news/articles/2015/10/22/epa-to-blame-for-preventable-gold-king-mine-
spill-interior-dept-finds (accessed January 25, 2023).

6. — Christopher Helman, “EPA Official Not Only Touted ‘Crucifying’ Oil Companies, He Tried It,” Forbes, April 26,
2012, https://www.forbes.com/sites/christooherhelman/2012/04/26/epa-official-not-only-touted-crucifying-
oil-companies-he-tried-it/?sh=5b7472b15dc9 (accessed March 20, 2023).

7. News release, “EPA Celebrates 50 Year[s] of Progress, Dedicates Conference Center to First Administrator,”
U.S. Environmental Protection Agency, December 2, 2020, https://www.epa.gov/newsreleases/
epa-celebrates-50-year-progress-dedicates-conference-center-first-administrator (accessed
January 25, 2023).

8. Case Western Reserve University, “Encyclopedia of Cleveland History: Cuyahoga River Fire,” httos://case.edu/
ech/articles/c/cuyahoga-river-fire (accessed January 25, 2023).

9. — President Richard Nixon, “Reorganization Plan No. 3 of 1970: Special Message from the President to the
Congress About Reorganization Plans to Establish the Environmental Protection Agency and the National
Oceanic and Atmospheric Administration,” July 9, 1970, https://www.epa.gov/archive/epa/aboutepa/
reorganization-plan-no-3-1970.html (accessed January 25, 2023).

10. Ibid.

11. US. Environmental Protection Agency, “Summary of the Clean Air Act, 42 U.S.C. $7401 et seq. (1970),” last

updated September 12, 2022, https://\www.epa.gov/laws-regulations/summary-clean-air-act (accessed

January 27, 2023).

12. U.S. Environmental Protection Agency, “Summary of the Clean Water Act, 33 U.S.C. $1251 et seq. (1972),”

ast updated July 6, 2022, https://www.epa.gov/laws-regulations/summary-clean-water-act (accessed

January 25, 2023).

13. U.S. Environmental Protection Agency, “1990 Clean Air Act Amendment Summary,” last updated November

28, 2022, https://www.epa.gov/clean-air-act-overview/1990-clean-air-act-amendment-summary (accessed

January 25, 2023).

14. U.S. Department of State, Office of Environmental Quality, “The Montreal Protocol on Substances That Deplete

he Ozone Layer,” https://www.state.gov/key-topics-office-of-environmental-quality-and-transboundary-

issues/the-montreal-protocol-on-substances-that-deplete-the-ozone-layer/ (accessed January 25, 2023).

15. 5US. Code § 3345 et seq., httos://Awww.law.cornell.edu/uscode/text/5/3345 (accessed March 20, 2023).

16. 42U/S. Code § 7261(a), https://www.govinfo.gov/content/pkg/USCODE-2013-title42/html/USCODE-2013-

itle42-chap85-subchaplll-sec7621.htm (accessed January 25, 2023).

17. 42 US. Code § 7607(d), https://www.govinfo.gov/content/pkg/USCODE-2013-title42/html/USCODE-2013-

itle42-chap85-subchaplll-sec7607.htm (accessed January 25, 2023).

18. H.R. 5376, Inflation Reduction Act of 2022, Public Law No. 117-169, 117th Congress, August 16, 2022, https://
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iD)

— 446 —

19.
20.
ZV,
22.
28.
24.
D>.
26.

27.

28.

29.
30.

31.
32.
55:
34,

55:

36.
Sf.
38.

39.

AO.

Al.

42.

43.

2025 Presidential Transition Project

42 U.S. Code § 7426(b), https://www.law.cornell.edu/uscode/text/42/7426 (accessed January 26, 2023).

42 U.S. Code § 7410(k)(5)-(6), https://www.law.cornell.edu/uscode/text/42/7410 (accessed January 26, 2023).
42 U.S. Code § 7601(a), https:/Awww.law.cornell.edu/uscode/text/42/7601 (accessed January 26, 2023).

42 U.S. Code § 7675, https://www.law.cornell.edu/uscode/text/42/7675 (accessed January 26, 2023).

42 U.S. Code § 7411, https://www.law.cornell.edu/uscode/text/42/7411 (accessed January 26, 2023).

42 US. Code § 741I(d).

42 U.S. Code § 7412, httos://Awww.law.cornell.edu/uscode/text/42/7412 (accessed January 26, 2023).

U.S. Environmental Protection Agency, “Summary of the Clean Wa

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ter Act, 33 U.S.C. $1251 et seq. (1972),”

ast updated July 6, 2022, https://www.epa.gov/laws-regulations/summary-clean-water-act (accessed

U.S. Environmental Protection Agency, “Summary of the Safe Drinking Water Act, 42 U.S.C. §300f et seq,
(1974),” last updated September 12, 2022, https://www.epa.gov/laws-regulations/summary-safe-drinking-

mental Protection Agency, to Office of
Documents,” August 6, 2019, https://
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33 US. Code § 1341, https://www.law.cornell.edu/uscode/text/33/1341 (accessed January 26, 2023).

ia.com/cases/federal/us/547/04-1034/

33 US. Code § 1318, https://www.law.cornell.edu/uscode/text/33/1318 (accessed January 26, 2023).

33 US. Code § 1342, https://www.law.cornell.edu/uscode/text/33/

342 (accessed January 26, 2023).

33 US. Code § 1344, https://www.law.cornell.edu/uscode/text/33/
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344 (accessed January 26, 2023).
Conservation and Recovery Act, 42 U.S.C.

§6901 et seq. (1976),” last updated September 12, 2022, https://www.epa.gov/laws-regulations/summary-
resource-conservation-and-recovery-act (accessed January 27, 2023).

U.S. Environmental Protection Agency, “Summary of the Comprehensive Environmental Response,
Compensation, and Liability Act (Superfund), 42 U.S.C. $9601 et seq. (1980),” last updated September

12, 2022, https://www.epa.gov/laws-regulations/summary-comprehensive-environmental-response-

compensation-and-liability-act (accessed January 27, 2023).

42 U.S. Code § 7412(r), https://www.law.cornell.edu/uscode/text/42/7412 (accessed January 27, 2023).

U.S. Environmental Protection Agency, “Summary of the Toxic Sub

control-act (accessed January 27, 2023).

ood-drug-and-cosmetic-act (accessed January 27, 2023).

chemical (accessed January 27, 2023).

species-act (accessed January 27, 2023).

42 U.S. Code § 6924(n), https://www.law.cornell.edu/uscode/text/42/6924 (accessed January 27, 2023).

stances Control Act, 15 U.S.C. $2601 et seq.

(1976),” last updated October 4, 2022, https://Awww.epa.gov/laws-regulations/summary-toxic-substances-

U.S. Environmental Protection Agency, “Summary of the Federal Insecticide, Fungicide, and Rodenticide
Act, 7 U.S.C. 8136 et seq. (1996),” last updated September 12, 2022, https://www.epa.gov/laws-regulations/
summary-federal-insecticide-fungicide-and-rodenticide-act (accessed January 27, 2023).
U.S. Environmental Protection Agency, “Summary of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. $301
et seq. (2002),” last updated September 12, 2022, https://www.epa.gov/laws-regulations/summary-federal-

U.S. Environmental Protection Agency, “The Frank R. Lautenberg Chemical Safety for the 21st Century Act,”
ast updated March 24, 2022, https://www.epa.gov/assessing-and-managing-chemicals-under-tsca/frank-r-
autenberg-chemical-safety-21st-century-act (accessed January 27, 2023), and “Highlights of Key Provisions
in the Frank R. Lautenberg Chemical Safety Act for the 21st Century,” last updated February 12, 2020, https://
www.epa.gov/assessing-and-managing-chemicals-under-tsca/highlights-key-provisions-frank-r-lautenberg-

U.S. Environmental Protection Agency, “Summary of the Endangered Species Act, 16 U.S.C. §1531 et seq.
(1973),” last updated September 12, 2022, https://www.epa.gov/laws-regulations/summary-endangered-

U.S. Environmental Protection Agency, “PRIA Overview and History,” last updated July 19, 2022, https://Awww.

epa.gov/pria-fees/pria-overview-and-history (accessed January 27, 2023).

— 447 —

AA.

45.

46.

47.
48.
49.
50.
51.

52:

53.

54.

503

56.

of.

Mandate for Leadership: The Conservative Promise

Table, “EPA Budget by

National Program Manager and Major Office,” in U.S. Environmental Protection Agency,

United States Environmental Protection Agency Fiscal Year 2023 Justification of Appropriation Estimates for

the Committee on Appropriations, p. 1076.
U.S. Environmental Protection Agency, “All Federal Advisory Committees at EPA,” last upda
https://www.epa.gov/faca/all-federal-advisory-committees-epa (accessed March 20, 2023).

ed March 10, 2023,

For example, EPA has steadfastly refused to follow Clean Air Act requirements that the Clean Air Scientific

Advisory Committee

provide, in the words of the U.S. Supreme Court, “unquestionably pertinent” advice on

the “relative contribution to air pollution concentrations of natural... activity” as well as “any adverse public
health, welfare, social, economic, or energy effects which may result from various strategies for attainment

and maintenance” of

Agency, to Assistant Administrators, “Subject: Back-to-Basics P

Air Quality Standards

9, 20

image2018-05-09-173219.pd
8), and Whitman v. American Trucking Associations, 531 U.S. 457, 470 n.2

the NAAQS. Memorandum from E. Scot Environmental Protection

National Ambient

8-05/documents/
emorandum, May

), https://supreme.

Pruitt, Administrator,
ocess for Reviewing
,” May 9, 2018, p. 4, https://www.epa.gov/sites/default/files/20
(accessed January 25, 2023) (cited hereafter as Pruitt
(200

justia.com/cases/federal/us/531/457/case.pdF (accessed January 25, 2023). Similarly, EPA has refused to

follow legal requirem
Pruitt Memorandum,

ents dating to the late 1970s regarding congressional requests for scientific advice.
May 9, 2018; U.S. Government Accountability Office, “EPA Science and Advisory

Panels: Preliminary Observations on the Processes for Providing Scientific Advice,” testimony of J. Alfredo
Gémez, Director, Natural Resources and Environment, GAO, before the Subcommittee on Superfund,

Waste Management,

and Regulatory Oversight, Committee on Environment and Public Works, U.S. Senate,

GAO-15-636T, May 20, 2015, https://www.gao.gov/products/gao-15-636t (accessed January 25, 2023);

and U.S. Government

Accountability Office, “EPA Science Advisory Board: Policy Statement on Science

Quality and Integrity,” GAO-17-526R, June 8, 2017, https://www.gao.gov/assets/gao-17-526r.pdf (accessed

January 25, 2023).
31 U.S. Code § 3729 e
See Pruitt Memorand

congress.gov/92/stat
5 U.S. Code Chapter
January 27, 2023).

ndian Environmenta
uscode/text/42/4368)

seq., httos://www.law.cornell.edu/uscode/text/31/3729 (accessed March 20, 2023).
m, May 9, 2018.

H.R. 4383, Federal Advisory Committee Act, Public Law 92-463, 92nd Congress, October 6, 1972, https://www.

ute/STATUTE-86/STATUTE-86-Pg770.pdf (accessed March 20, 2023).
56A, https://www.law.cornell.edu/uscode/text/15/chapter-56A (accessed

General Assistance Act of 1992, 42 U.S. Code § 4368b, https://www.law.cornell.edu/
b (accessed January 27, 2023).

See U.S. Environmen

Office of General Cou

U.S. Environmental
epa.gov/sites/defau
January 27, 2023).

U.S. Environmental
et seq. (1969),” last

Environmental Justice, May
Tools%20May%202022%20FINAL.pdf (accessed January 25, 2023), and U.S. Environmental Protection Agency,

al Protection Agency, Office of General Counsel, EPA Legal Tools to Advance
2022, https://www.epa.gov/system/files/documents/2022-05/EJ%20Legal%20

nsel, Office of Policy, “Interim Environmental Justice and Civil Rights in Permitting

Frequently Asked Questions,” August 2022, httos:/Awww.epa.gow/system/files/documents/2022-08/EJ%20
and%20CR%20in%20PERM
2 US. Code §§ 2000d-2000d-7, h
(accessed January 27,
Students for Fair Admissions, Inc. v. University of North Carolina, No.
https://www.leagle.com/decision/infdco20191008)38 (accessed Janua

TTING%20FAQs%20508%20compliant.pdf (accessed January 25, 2023).
ps://www.law.cornell.edu/uscode/text/42/chapter-21/subchapter-V

2023).

14CV954 (M.D.N.C. Sep. 30, 2019),

y 27, 2023).

Protection Agency, EPA Region 2 Environmental Justice Action Plan, p. 24, https://www.
It/files/2016-03/documents/region_2_environmental_justice_action_plan.pdf (accessed

Protection Agency, “Summary of the National Environmental Policy Act, 42 U.S.C. $4321
pdated September 12, 2022, https://www.epa.gov/laws-regulations/summary-national-

environmental-policy-act (accessed January 27, 2023).

31 US. Code § 1115, httos://www.law.cornell.edu/uscode/text/31/1115 (accessed January 27, 2023).

— 448 —

DEPARTMENT OF HEALTH
AND HUMAN SERVICES

Roger Severino

fthe U.S. Department of Health and Human Services (HHS) were a separate coun-
] try, its approximately $1.6 trillion budget would rank as the world’s fifth-largest

national budget. For good or ill, HHS activities personally impact the lives of more
Americans than do those of any other federal agency. Under President Trump, HHS
was dedicated to serving “all Americans from conception to natural death, including
those individuals and families who face...economic and social well-being challenges.”
Under President Biden, the mission has shifted to “promoting equity in everything
we do” for the sake of “populations sharing a particular characteristic” including race,
sexuality, gender identification, ethnicity, and a host of other categories.”

As aresult of HHS’s having lost its way, U.S. life expectancy, instead of return-
ing to normal after the COVID-19 pandemic, continued to drop precipitously to
levels not seen since 1996 with white populations alone losing 7 percent of their
expected life span in just one year.* Nothing less than America’s long-term survival
is at stake. Accordingly, HHS must return to serving the health and well-being of
all Americans at all stages of life instead of using social engineering that leaves us
sicker, poorer, and more divided.

OVERVIEW

HHS consists of 11 operating divisions that have varying degrees of practical
independence from the Secretary of Health and Human Services and 15 staff
divisions that are directly under the Office of the Secretary. This chapter’s rec-
ommendations are limited to those divisions that most need reform and address,
wherever possible, five cross-cutting goals.

— 449 —

Mandate for Leadership: The Conservative Promise

Goal #1: Protecting Life, Conscience, and Bodily Integrity. The Secretary
should pursue a robust agenda to protect the fundamental right to life, protect con-
science rights, and uphold bodily integrity rooted in biological realities, not ideology.

From the moment of conception, every human being possesses inherent dignity
and worth, and our humanity does not depend on our age, stage of development,
race, or abilities. The Secretary must ensure that all HHS programs and activities
are rooted in a deep respect for innocent human life from day one until natural
death: Abortion and euthanasia are not health care.

Arobust respect for the sacred rights of conscience, both at HHS and among gov-
ernments and institutions funded by it, increases choices for patients and program
beneficiaries and furthers pluralism and tolerance. The Secretary must protect
Americans’ civil rights by ensuring that HHS programs and activities follow the
letter and spirit of religious freedom and conscience-protection laws.

Radical actors inside and outside government are promoting harmful identity
politics that replaces biological sex with subjective notions of “gender identity” and
bases a person’s worth on his or her race, sex, or other identities. This destructive
dogma, under the guise of “equity,” threatens American’s fundamental liberties as
well as the health and well-being of children and adults alike. The next Secretary
must ensure that HHS programs protect children’s minds and bodies and that
HHS programs respect parents’ basic right to direct the upbringing, education,
and care of their children.

Goal #2: Empowering Patient Choices and Provider Autonomy. Basic eco-
nomics holds that costs tend to decrease and quality and options tend to increase
when there is robust and free competition in the provision of goods and services.
Health care is no exception. Health care reform should be patient-centered and
market-based and should empower individuals to control their health care-related
dollars and decisions.

Of course, providers who deliver health care also need the freedom to address
the unique needs of their patients. States should be the primary regulators of the
medical profession, and the federal government should not restrict providers’ abil-
ity to discharge their responsibilities or limit their ability to innovate through
government pricing controls or irrational Medicare and Medicaid reimburse-
ment schemes.

Finally, America’s broken insurance system, run largely through confusing pro-
vider networks and third-party payers (employers), induces overconsumption of
health care, limits consumer shopping, and hides true costs from patients.

The federal government should focus reform on reducing burdens of regulatory
compliance, unleashing innovation in health care delivery, ceasing interference in
the daily lives of patients and providers, allowing alternative insurance coverage
options, and returning control of health care dollars to patients making decisions
with their providers about their health care treatments and services.

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Goal #3: Promoting Stable and Flourishing Married Families. Families
comprised of a married mother, father, and their children are the foundation of
a well-ordered nation and healthy society. Unfortunately, family policies and
programs under President Biden’s HHS are fraught with agenda items focusing
on “LGBTQ+ equity,” subsidizing single-motherhood, disincentivizing work, and
penalizing marriage. These policies should be repealed and replaced by policies
that support the formation of stable, married, nuclear families.

Working fathers are essential to the well-being and development of their
children, but the United States is experiencing a crisis of fatherlessness that is
ruining our children’s futures. In the overwhelming number of cases, fathers
insulate children from physical and sexual abuse, financial difficulty or poverty,
incarceration, teen pregnancy, poor educational outcomes, high school failure,
and a host of behavioral and psychological problems. By contrast, homes with
non-related “boyfriends” present are among the most dangerous place for a child
to be. HHS should prioritize married father engagement in its messaging, health,
and welfare policies.

In the context of current and emerging reproductive technologies, HHS policies
should never place the desires of adults over the right of children to be raised by
the biological fathers and mothers who conceive them. In cases involving biolog-
ical parents who are found by a court to be unfit because of abuse or neglect, the
process of adoption should be speedy, certain, and supported generously by HHS.

Goal #4: Preparing for the Next Health Emergency. The COVID-19 pan-
demic demonstrated how catastrophic a micromanaging, misinformed, centralized,
and politicized federal government can be. Basic human rights, medical choice, and
the doctor-patient relationship were trampled without scientific justification and
for extended periods of time. Excess deaths, not due to COVID-19, skyrocketed
because of forced lockdowns, isolation, vaccine-related mass firings, and colossal
disruptions of the economy and daily rhythms of life.

The federal government’s public health apparatus has lost the public’s trust.
Before the next national public health emergency, this apparatus must be funda-
mentally restructured to ensure a transparent, scientifically grounded, and more
nimble, efficient, transparent, and targeted response that respects the unique
needs and input of patient populations and providers.

Every one of the overreaching policies during the pandemic—from lockdowns
and school closures to mask and vaccine mandates or passports—received its
supposed legal justification from the state of emergency declared (and renewed)
by the HHS Secretary. Tellingly, however, the threshold for what constitutes a
public health emergency—how many cases, hospitalizations, deaths, etc.—was
never defined. For the sake of democratic accountability, we must know with clarity
what will trigger the next emergency declaration and, just as important, what will
trigger its end.

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Unaccountable bureaucrats like Anthony Fauci should never again have such
broad, unchecked power to issue health “guidelines” that will certainly be the basis
for federal and state mandates. Never again should public health bureaucrats be
allowed to hide information, ignore information, or mislead the public concerning
the efficacy or dangers associated with any recommended health interventions
because they believe it may lead to hesitancy on the part of the public. The only
way to restore public trust in HHS as an institution capable of acting responsibly
during a health emergency is through the best of disinfectants—light.

Goal #5: Instituting Greater Transparency, Accountability, and Over-
sight. The next Administration should guard against the regulatory capture of our
public health agencies by pharmaceutical companies, insurers, hospital conglomer-
ates, and related economic interests that these agencies are meant to regulate. We
must erect robust firewalls to mitigate these obvious financial conflicts of interest.

All National Institutes of Health, Centers for Disease Control and Prevention,
and Food and Drug Administration regulators should be entirely free from pri-
vate biopharmaceutical funding. In this realm, “public-private partnerships” is a
euphemism for agency capture, a thin veneer for corporatism. Funding for agencies
and individual government researchers must come directly from the government
with robust congressional oversight.

We must shut and lock the revolving door between government and Big Pharma.
Regulators should have a long “cooling off period” on their contracts (15 years
would not be too long) that prevents them from working for companies they have
regulated. Similarly, pharmaceutical company executives should be restricted from
moving from industry into positions within regulatory agencies.

Finally, HHS should adopt metrics across the agency that can objectively deter-
mine the extent to which the agency’s policies and programs achieve desired health
and welfare outcomes (not agency outputs). What is not measured is not achieved.

CENTERS FOR DISEASE CONTROL AND PREVENTION (CDC)

COVID and Structural Reform. COVID-19 exposed the Centers for Disease
Control and Prevention (CDC) as perhaps the most incompetent and arrogant
agency in the federal government. CDC continually misjudged COVID-19, from
its lethality, transmissibility, and origins to treatments. We were told masks were
not needed; then they were made mandatory. CDC botched the development of
COVID tests when they were needed most. When it was too late, we were told to put
our lives on hold for “two weeks to flatten the curve;” that turned into two years of
interference and restrictions on the smallest details of our lives. Congress should
ensure that CDC’s legal authorities are clearly defined and limited to prevent a
recurrence of any such arbitrary and vacillating exercise of power.

The CDC should be split into two separate entities housing its two distinct func-
tions. On the one hand, the CDC is now responsible for collecting, synthesizing,

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and publishing epidemiological data from the individual states—a scientific
data-gathering function. This information is crucial for medical and public health
researchers around the country. On the other hand, the CDC is also responsible
for making public health recommendations and policies—an inescapably political
function. At times, these two functions are in tension or clear conflict. In February
2022, for example, it was reported that “[t]wo full years into the pandemic, the
agency leading the country’s response to the public health emergency has pub-
lished only a tiny fraction of the data it has collected,” much of which “could [have
helped] state and local health officials better target their efforts to bring the virus
under control.” A CDC spokesman said that one of the reasons was “fear that the
information might be misinterpreted.”*

These distinct functions should be separated into two entirely separate agen-
cies with a firewall between them. We need a national epidemiological agency
responsible only for publishing data and required by law to publish all of the data
gathered from states and other sources. A separate agency should be responsible
for public health with a severely confined ability to make policy recommendations.
The CDC can and should make assessments as to the health costs and benefits of
health interventions, but it has limited to no capacity to measure the social costs
or benefits they may entail. For example, how much risk mitigation is worth the
price of shutting down churches on the holiest day of the Christian calendar and
far beyond as happened in 2020? What is the proper balance of lives saved versus
souls saved? The CDC has no business making such inherently political (and often
unconstitutional) assessments and should be required by law to stay in its lane.

The CDC’s initial COVID -19 testing failures were largely the result of that agen-
cy’s prioritizing its own development and production of tests using its internal
staff and facilities. The private sector is much better positioned to tackle the chal-
lenges inherent in developing and manufacturing novel products, as illustrated by
the relative success of the alternative approach to facilitating the development of
COVID-19 vaccines and therapeutics by private companies that was adopted by
the Food and Drug Administration (FDA).

When it comes to testing, the CDC’s role should similarly be to facilitate rather
than supplant the efforts of private test developers, academic laboratories, state
public health laboratories, and clinical testing providers. When responding to a
novel pathogen, the CDC should focus on gathering and disseminating information,
including specimens needed for development of positive controls and reference
panels, and ensuring that test developers can develop and validate diagnostic
tests. These changes will require a shift in priorities and culture at the CDC—and
throughout HHS more broadly.®

Most problematically, the CDC presented itself as a kind of “super-doctor” for
the entire nation. The CDC is a public health institution, not a medical institution.
According to its mission statement, the agency focuses on “disease prevention and

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control, environmental health, and health promotion and health education activi-
ties.”° It is not qualified to offer (and usually does not purport to offer) professional
medical opinions applicable to specific patients.

From time to time, the CDC offers findings and recommendations that compe-
tent medical practitioners often will consider in arriving at a professional medical
judgment for a particular patient. In this respect, CDC guidelines are analogous
to guidelines from other public health associations or medical societies: They are
informative, not prescriptive.

By statute or regulation, CDC guidance must be prohibited from taking on a
prescriptive character. For example, never again should CDC officials be allowed to
say in their official capacity that school children “should be” masked or vaccinated
(through a schedule or otherwise) or prohibited from learning ina school building.
Such decisions should be left to parents and medical providers. We have learned
that when CDC says what people “should” do, it readily becomes a “must” backed by
severe punishments, including criminal penalties. CDC should report on the risks
and effectiveness of all infectious disease-mitigation measures dispassionately
and leave the “should” and “must” policy calls to politically accountable parties.

Conflicts of Interest. There was a time when the CDC could not take money
from the pharmaceutical industry, but in 1992, the agency discovered a loophole in
federal law that allowed it to accept pharma contributions through the nonprofit
CDC Foundation. The money started flowing immediately: From 2014 through
2018, the CDC Foundation received $79.6 million from pharmaceutical corpo-
rations like Pfizer, Biogen, and Merck.’ This practice presents a stark conflict of
interest that should be banned.

Data Systems. The COVID-19 pandemic has revealed the disastrous public
health consequences of the CDC’s failure to follow multiple congressional
mandates to modernize its data infrastructure. Current reporting methods are
burdensome for frontline medical workers, yet they result only in fragmented data
that are not available in real time or usable across systems.

Congress should require HHS to prioritize the electronic collection and dis-
semination of robust, privacy-protected data that better leverages existing systems
while reducing burdens on clinicians. HHS should also enter into a public-private
partnership with a data-management expert to develop a system that makes crit-
ical information available to health care workers and policymakers in real time.®

The CDC operates several programs related to vaccine safety including the Vac-
cine Adverse Event Reporting System (VAERS); Vaccine Safety Datalink (VSD);
and Clinical Immunization Safety Assessment (CISA) Project. Those functions and
their associated funding should be transferred to the FDA, which is responsible for
post-market surveillance and evaluation of all other drugs and biological products.

Respect for Life and Conscience. The CDC should eliminate programs and
projects that do not respect human life and conscience rights and that undermine

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family formation. It should ensure that it is not promoting abortion as health care.
It should fund studies into the risks and complications of abortion and ensure that
it corrects and does not promote misinformation regarding the comparative health
and psychological benefits of childbirth versus the health and psychological risks
of intentionally taking a human life through abortion.

The CDC oversaw and funded the development and testing of the COVID-19
vaccines with aborted fetal cell lines, insensitive to the consciences of tens of
thousands to hundreds of thousands of people who objected to taking a vac-
cine with such a link to abortion. As evidenced by litigation across the country,
it is likely that thousands were fired unjustly because of the exercise of their
consciences or faith on this question, which could have been avoided with a
modicum of concern for this issue from CDC. There is never any justification for
ending a child’s life as part of research, and the research benefits from splicing or
growing aborted fetal cells and aborted baby body parts can easily be provided
by alternative sources. All such research should be prohibited as a matter of
law and policy.

CDC should update its public messaging about the unsurpassed effectiveness of
modern fertility awareness—based methods (FABMs) of family planning and stop
publishing communications that conflate such methods with the long-eclipsed

“rhythm” or “calendar” methods. CDC should fund studies exploring the evi-
dence-based methods used in cutting-edge fertility awareness.

Data Collection. The CDC’s abortion surveillance and maternity mortality
reporting systems are woefully inadequate. CDC abortion data are reported by
states on a voluntary basis, and California, Maryland, and New Hampshire do not
submit abortion data at all. Accurate and reliable statistical data about abortion,
abortion survivors, and abortion-related maternal deaths are essential to timely,
reliable public health and policy analysis.

Because liberal states have now become sanctuaries for abortion tourism, HHS
should use every available tool, including the cutting of funds, to ensure that every
state reports exactly how many abortions take place within its borders, at what
gestational age of the child, for what reason, the mother’s state of residence, and
by what method. It should also ensure that statistics are separated by category:
spontaneous miscarriage; treatments that incidentally result in the death of a child
(such as chemotherapy); stillbirths; and induced abortion. In addition, CDC should
require monitoring and reporting for complications due to abortion and every
instance of children being born alive after an abortion. Moreover, abortion should
be clearly defined as only those procedures that intentionally end an unborn child’s
life. Miscarriage management or standard ectopic pregnancy treatments should
never be conflated with abortion.

Comparisons between live births and abortion should be tracked across vari-
ous demographic indicators to assess whether certain populations are targeted by

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abortion providers and whether better prenatal physical, mental, and social care
improves infant outcomes and decreases abortion rates, especially among those
who are most vulnerable.

The Ensuring Accurate and Complete Abortion Data Reporting Act of 2023°
would amend title XIX of the Social Security Act and Public Health Service Act
to improve the CDC’s abortion reporting mechanisms by requiring states, as a
condition of federal Medicaid payments for family planning services, to report
streamlined variables in a timely manner.

The CDC should immediately end its collection of data on gender identity, which
legitimizes the unscientific notion that men can become women (and vice versa)
and encourages the phenomenon of ever-multiplying subjective identities.

FOOD AND DRUG ADMINISTRATION (FDA)

The FDA’s mission includes ensuring the safety and efficacy of drugs, biological
products, and medical devices.

Federal Laws That Shield Big Pharma from Competition. Because generics
generally cost far less than brand-name drugs, consumers begin to save money as
soon as a generic product comes on the market. The vast majority are very afford-
able with 93 percent of generic products costing $20 or less.

Savings would be even higher under proposals that prevent brand-name man-
ufacturers from slowing down or impeding the entrance of generic products into
the marketplace. Specifically, the FDA should prohibit pharmaceutical companies
from purposely sitting on their legally available right to be the first to sell generic
versions of their drugs. Additionally, Congress should create legal remedies for
generic companies to obtain samples of brand-name products for their generic
development efforts and should prohibit meritless “citizen petitions” submitted
by manufacturers to delay approval of a generic competitor.”°

Approval Process for Laboratory-Developed or Modified Medical Tests.
Learning from the failed early COVID -19 testing experience, Congress and the FDA
should focus on reforming laws and regulations governing medical tests, especially
with respect to laboratory-developed tests.

Commercial tests are developed with the intention of being widely marketed,
distributed, and used, while laboratory-developed tests are created with the
intention of being used solely within one laboratory. A test developed by a lab in
accordance with the protocols developed by another lab (non-commercial sharing)
currently constitutes a “new” laboratory-developed test because the lab in which
it will be used is different from the initial developing lab. To encourage interlab-
oratory collaboration and discourage duplicative test creation (and associated
regulatory and logistical burdens), the FDA should introduce mechanisms through
which laboratory-developed tests can easily be shared with other laboratories with-
out the current regulatory burdens.”

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The “laboratory-developed tests” category currently encompasses a range of
possible tests, many of which would be characterized more appropriately as “lab-
oratory-modified tests” because they are not truly novel tests but rather modified
versions of existing tests. To avoid stifling innovation and access to medical care,
the applicable statutes and regulations should be revised to facilitate greater access
to such modified tests.”

Finally, the FDA has long held that it has regulatory authority over such tests,
while others have argued that they should be considered clinical services regulated
by the Centers for Medicare and Medicaid Services (CMS). The FDA currently
has regulatory authority over in vitro diagnostics, and under the Clinical Lab-
oratory Improvement Amendments (CLIA)," the CMS ensures that labs meet
analytical validity standards for test methods. Congress, the FDA, and the CMS
need to clarify and disentangle overlapping authorities over tests to eliminate
regulatory confusion."

Drug Shortages. The very thin profit margins and the regulatory burdens
associated with generic drug manufacturing discourage inventory and capacity
investments by manufacturers and contribute to drug shortages. HHS and the FDA
should encourage more dependable generic drug manufacturing.

The FDA should expand its current pass/fail approach to drug facility inspec-
tions into a graded system that recognizes manufacturers that exceed minimum
standards by investing in improving production reliability. The FDA should also
add facility codes to drug packaging and construct a searchable database that
cross-references product codes and facility codes. That would enable wholesalers
and pharmacy benefit managers to identify and preference drugs manufactured at
more reliable facilities, thus encouraging generic drug manufacturers to compete
on reliability as well as on price.

For its part, HHS should exempt multi-source generic drugs from requirements
to pay rebates to Medicaid and other federally funded health programs, as those
provisions penalize new investments in expanding manufacturing capacity when
supply is unable to meet demand.” Additionally, FDA and NIH should promote
efficacy trials of new applications for generic drugs, which might include NIH fund-
ing such trials or conducting its own.

Abortion Pills. Abortion pills pose the single greatest threat to unborn chil-
dren in a post-Roe world. The rate of chemical abortion in the U.S. has increased
by more than 150 percent in the past decade; more than half of annual abortions
in the US. are chemical rather than surgical.

The abortion pill regimen is typically a two-part process. The first pill, mifepris-
tone, causes the death of the unborn child by cutting off the hormone progesterone,
which is required to sustain a pregnancy. The second pill, misoprostol, causes con-
tractions to induce a delivery of the dead child and uterine contents, usually into a
toilet at home. The abortion-pill regimen is currently approved for up to 70 days

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(10 weeks) into pregnancy and before Biden was subject to a heightened safety
restriction called a Risk Evaluation and Mitigation Strategy (REMS) that requires
an in-person visit with a physician who can check for dangerous contraindications
such as ectopic pregnancies and can advise the mother seeking an abortion of the
risks of chemical abortion, including hemorrhaging, and what to do in such cir-
cumstances. Chemical abortion has been found to have a complication rate four
times higher than that of surgical abortion.

Since its approval more than 20 years ago, mifepristone has been associated with
26 deaths of pregnant mothers, over a thousand hospitalizations, and thousands
more adverse events, but that number does not account for all complications. Of
course, this does not count the hundreds of thousands to millions of babies whose
lives have been unjustly taken through chemical abortion. FDA should therefore:

e Reverse its approval of chemical abortion drugs because the
politicized approval process was illegal from the start. The FDA
failed to abide by its legal obligations to protect the health, safety, and
welfare of girls and women. It never studied the safety of the drugs
under the labeled conditions of use, ignored the potential impacts of the
hormone-blocking regimen on the developing bodies of adolescent girls,
disregarded the substantial evidence that chemical abortion drugs cause
more complications than surgical abortions, and eliminated necessary
safeguards for pregnant girls and women who undergo this dangerous drug
regimen. Furthermore, at no point in the past two decades has the FDA ever
acknowledged or addressed federal laws that prohibit the distribution of
abortion drugs by postal mail; to the contrary, the FDA has permitted and
actively encouraged such activity.

Now that the Supreme Court has acknowledged that the Constitution
contains no right to an abortion, the FDA is ethically and legally obliged to
revisit and withdraw its initial approval, which was premised on pregnancy
being an “illness” and abortion being “therapeutically” effective at treating
this “illness.” The FDA is statutorily charged with guaranteeing the

safety and efficacy of drugs and therefore should withdraw this drug that

is proven to be dangerous to women and by definition fatally unsafe for
unborn children.

As an interim step, the FDA should immediately restore the REMS by removing
the in-person dispensing requirement to eliminate dangerous tele-abortion and
abortion-by-mail distribution.

Mail-Order Abortions. Allowing mail-order abortions is a gift to the abortion
industry that allows it to expand far beyond brick-and-mortar clinics and into

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pro-life states that are trying to protect women, girls, and unborn children from
abortion. The FDA should therefore:

e Reinstate earlier safety protocols for Mifeprex that were mostly
eliminated in 2016 and apply these protocols to any generic version
of mifepristone. A bare-minimum policy of limiting abortion pills to the
pre-2016 policy of 49 days gestation, returning to the pre-2021 in-person
dispensing requirement, and returning to requiring prescribers to report all
serious adverse events, not just deaths, to the drug sponsor would increase
women’s health and safety.

e Address weaknesses in the current FAERS (FDA Adverse Events
Reporting System). The Administration and policymakers should ensure
that health care workers, particularly those in hospitals and emergency rooms,
report abortion pill complications. Women who experience complications
from abortion pills typically go to an emergency room, not to the abortion pill
prescriber, so putting the onus of reporting on the prescriber who typically has
no idea that a complication has occurred means that the FAERS is seriously
undercounting adverse events. Submitting an adverse event to the database
should be a quick and efficient process for busy health care practitioners.
Currently, providers report that the process is difficult and convoluted.

e Implement a policy of transparency about inspections of the abortion
pill’s sponsors, Danco and GenBioPro, as well as facilities that
manufacture the pills. The FDA should respond to congressional requests
and Freedom of Information Act (FOIA) requests about inspections,
compliance, and post-marketing safety in a timely manner.

e Stop promoting or approving mail-order abortions in violation of
long-standing federal laws that prohibit the mailing and interstate
carriage of abortion drugs.'°

Vaccine Importation. Thousands of Americans of faith and conscience wish
to receive various childhood vaccinations for themselves and their families but are
not allowed to receive vaccines that are derived through or tested on aborted fetal
cells. For example, the chickenpox, Hepatitis, and MMR vaccines in the U.S. are all
linked to abortion in this way. There are ethically derived alternatives abroad that
have been used safely there for decades, but the FDA makes it exceedingly difficult
for Americans to import them.

In January 2021, the HHS Office for Civil Rights (OCR) and the FDA jointly
announced that HHS was required by the Religious Freedom Restoration Act

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(RFRA)” to allow bulk importation by doctors of certain Japanese-made vaccines
to accommodate religious needs of patients, but the Biden FDA unlawfully revoked
this waiver. The FDA should restore the waiver to comply with RFRA and for the
obvious public health benefits of increased childhood vaccination by families seek-
ing ethically derived alternatives.

To avoid future moral coercion of the sort experienced with the COVID-19 vac-
cines, the FDA and NIH should require the development of drugs and biologics that
are free from moral taint and switch to cell lines that are not derived from aborted
fetal cell lines or aborted baby body parts.

Conflicts of Interest. A 2018 report in Science found that more than two-thirds
of FDA reviewers later ended up at the same companies whose products they had
been reviewing while they were working for the government.’ This revolving door
is one mechanism by which pharmaceutical companies capture the agencies that
regulate them. The FDA should impose a lengthy cooling off period for reviewers,
preventing them from working for companies they regulated.

In 1997, the FDA relaxed regulations to permit broadcast drug advertisements,
after which Big Pharma began routine direct-to-consumer advertising, making the
United States and New Zealand the only countries where such practices are legal.
Following the 1997 changes, pharma became the largest advertiser for all major
media organizations. This buys considerable influence in the newsroom—whether
media companies acknowledge this or not—and distorts independent reporting on
public health issues. The FDA or Congress should regulate where and how paid
advertising is used by pharmaceutical companies more stringently, especially on
media outlets.

NATIONAL INSTITUTES OF HEALTH (NIH)

The National Institutes of Health (NIH) is the world’s largest biomedical
research agency and is made up of 27 different components called Institutes and
Centers. Despite its popular image as a benign science agency, NIH was respon-
sible for paying for research in aborted baby body parts, human animal chimera
experiments, and gain-of-function viral research that may have been responsible
for COVID-19.

Bioethics Reform. Research using fetal tissue obtained from elective abortions
is immoral and obsolete. Research using human embryonic stem cells also involves
the destruction of human life and should not be subsidized with taxpayer dollars.
Good science and life-affirming, ethical research are not mutually exclusive. In
fact, ethically derived sources such as discarded surgical tissue and adult stem cells
(made pluripotent), not tissue obtained from elective abortions, have contributed
the most successful treatments for a variety of ailments.

Congress authorized HHS to choose not to fund extramural abortion-de-
rived fetal tissue research that fails ethics advisory board review, and in 2019, the

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Trump Administration’s HHS chose that course. Subsequently, however, the Biden
Administration restored unrestricted funding of abortion-derived fetal tissue
research. HHS should:

e Promptly restore the ethics advisory committee to oversee abortion-
derived fetal tissue research, and Congress should prohibit such
research altogether.

e End intramural research projects using tissue from aborted children
within the NIH, which should end its human embryonic stem
cell registry.

e Aggressively implement a plan to pursue and fund ethical alternative
methods of research in order to ensure that abortion and embryo-
destructive related research, cell lines, and other testing methods
become both fully obsolete and ethically unthinkable.

In addition, the Administration should reconvene a new National Council on
Bioethics (NCB) to discuss new and emerging areas of ethical concern, to assess
whether the ends justify the means when it comes to the promise of therapies
and cures, and to establish what limiting principles should guide research and
health policy. Because the male-female dyad is essential to human nature and
because every child has a right to a mother and father, three-parent embryo cre-
ation and human cloning research should be banned. A new NCB should convene
leading experts to examine these issues and provide policy recommendations for
the new frontier of bioethical questions that our country will have to address in
the coming years.

Finally, HHS should create and promote a research agenda that supports pro-
life policies and explores the harms, both mental and physical, that abortion has
wrought on women and girls.

Conflicts of Interest. NIH maintains inappropriate industry ties that create
serious conflicts of interest. In 2018, it was revealed that a $100 million NIH study
on the benefits of moderate drinking was funded by the beer and liquor industry.”
More recently, the National Institute of Allergy and Infectious Diseases (NIAID),
Anthony Fauci’s division of the NIH, owns half of the patent for the Moderna
COVID-19 vaccine, among thousands of other pharma patents.”° Rather than pro-
viding grants to university-based investigators to run the clinical trials on their own
Moderna vaccine, the NIH conducted this research internally—a clear conflict of
interest. The NIAID will earn millions from this vaccine’s revenue with several
NIH employees (and their heirs) personally receiving up to $150,000 annually
from Moderna vaccine sales.”

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In May 2022, documents obtained pursuant to a FOIA request revealed that
NIH Director Francis Collins, NAIAD Director Anthony Fauci, and Fauci’s Deputy
Director, Clifford Lane, all received royalties from pharmaceutical companies
between 2009 and 2014.” Nonprofit watchdog Open the Books estimates that from
2010 to 2020, third parties paid more than $350 million in royalties to NIH and
its scientists, who are credited as coinventors. Most problematically, in the years
when they received payments, Collins, Fauci, and Lane were NIH administrators,
not researchers, with no plausible claim to be scientific co-discoverers.

Most of the world’s other advanced science countries have stricter prohibitions
on such conflicts, which helps to explain why the most significant studies on COVID
treatments, on natural immunity, and on vaccine efficacy have come mostly from
outside the U.S.

Funding for scientific research should not be controlled by a small group of
highly paid and unaccountable insiders at the NIH, many of whom stay in power
for decades. The NIH monopoly on directing research should be broken. Term
limits should be imposed on top career leaders at the NIH, and Congress should
consider block granting NIH’s grants budget to states to fund their own scientific
research. Nothing in this system would prevent several states from partnering to
co-fund large research projects that require greater resources or impact larger
regions. Likewise, the establishment of funding for scientific research at the state
level does not preclude more modest federal funding through the National Insti-
tutes of Health: The two models are not mutually exclusive.

The CDC and NIH Foundations, whose boards are populated with pharma-
ceutical company executives, need to be decommissioned. Private donations to
these foundations—a majority of them from pharmaceutical companies—should
not be permitted to influence government decisions about research funding or
public health policy.

Woke Policies. Under Francis Collins, NIH became so focused on the #MeToo
movement that it refused to sponsor scientific conferences unless there were a cer-
tain number of women panelists, which violates federal civil rights law against sex
discrimination. This quota practice should be ended, and the NIH Office of Equity,
Diversity, and Inclusion, which pushes such unlawful actions, should be abolished.

NIH has been at the forefront in pushing junk gender science. Instead, it
should fund studies into the short-term and long-term negative effects of cross-
sex interventions, including “affirmation,” puberty blockers, cross-sex hormones
and surgeries, and the likelihood of desistence if young people are given counseling
that does not include medical or social interventions.

CENTERS FOR MEDICARE AND MEDICAID SERVICES (CMS)

With the goal of being a societal safety net, Medicare and Medicaid touch more
American lives than does any other federal program. While they help many, they

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operate as runaway entitlements that stifle medical innovation, encourage fraud,

and impede cost containment, in addition to which their fiscal future is in peril.

Both programs should be managed so that the individuals enrolled are empow-

ered to make decisions for themselves and have quality options with affordable

prices driven by competition and innovation. Providers who participate should

retain (or have restored) the freedom to practice medicine and take care of their

patients according to their patients’ unique needs.

Medicare. Medicare should be reformed according to four goals and principles:

Increase Medicare beneficiaries’ control of their health care.
Patients are best positioned to determine the value of health care
services, working with their health care providers. They also benefit from
increased choice of doctors, hospitals, and insurance plans. Access to
reliable information with respect to physicians, hospitals, and insurers is
therefore essential.

Reduce regulatory burdens on doctors. Doctors must be free to focus on
treating patients first, not entering codes on computers, and should not be
tempted to change their medical judgment based on arbitrary or illogical
reimbursement incentives.

Ensure sustainability and value for beneficiaries and taxpayers.
Prices are best for patients when determined by economic value rather

than political power and when they are known in advance of the receipt of
services. Government’s use of non-market-based methods to determine
reimbursement leads to overspending on low-value services and products
and underpayment for high-value services and products, stifles beneficial
innovation, and because of Medicare’s size distorts payments throughout
the health care system. Intermediate entities that can manage financial risk
and ensure quality of care are important in transitioning to value-based care
within the Medicare program.

Reduce waste, fraud, and abuse, including through the use of artificial
intelligence for their detection.

Regulatory Reforms. Medicare regulations restrict choice of coverage and

care. The next Administration should reintroduce and restore regulations and

demonstrations from the Trump Administration that were withdrawn, weakened,

or never finalized by the Biden Administration, including:

The Medicare Coverage of Innovative Technologies (MCIT) rule;

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The Risk Adjustment Data Validation C(RADV) rule;

The Medicare Advantage Qualifying Payment Arrangement Incentive
(MAQI) demonstration; and

The Global and Professional Direct Contracting (GPDC, rebranded as the
Accountable Care Organization Realizing Equity, Access, and Community
Health or ACO REACH) model.

Additionally, regulations should advance site neutrality by eliminating the inpa-

tient-only list and expanding the ambulatory surgical center covered procedures

list. Medicare generally pays more for inpatient hospital procedures and less for

the same procedures performed in an outpatient setting. Whether a medical ser-

vice is delivered in a physician’s office, a clinic, or a hospital setting, the Medicare

payment for that service should be the same. CMS should expand the application

of site-neutral payment options to more settings. Such a policy would level the

playing field among providers and remove the financial disabilities for medical

professionals who would compete with hospital systems.”*

Finally, HHS needs to restore and enhance conscience protection regulations

that allow medical practitioners to participate in federal health care programs

without being compelled to provide sex changes or similar services.

LEGISLATIVE PROPOSALS

Remove restrictions on physician-owned hospitals. The Affordable
Care Act (ACA)* imposed restrictions prohibiting Medicare from
reimbursing physician-owned and specialty hospitals. The current
restrictions do little more than serve the special interests of large hospital
systems and undercut consumer choice of high-quality, specialty care.
These restrictions should be removed so that physician-owned hospitals can
compete with other hospitals in serving Medicare patients.”°

Encourage more direct competition between Medicare Advantage
and private plans. Medicare Advantage (MA), a system of competing
private health plans, is the major alternative to traditional Medicare for
America’s large and growing cohort of seniors. The program provides
beneficiaries with a wide range of competitive health plan choices—a richer
set of benefits than traditional Medicare provides and at a reasonable cost.
Equally as important, the MA program has been registering consistently
high marks for superior performance in delivering high-quality care.
Critical reforms are still needed to strengthen and improve the program for
the future. Specifically:

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1. Make Medicare Advantage the default enrollment option.
2. Give beneficiaries direct control of how they spend Medicare dollars.
3. Remove burdensome policies that micromanage MA plans.

4. Replace the complex formula-based payment model with a competitive
bidding model.

5. Reconfigure the current risk adjustment model.

6. Remove restrictions on key benefits and services, including those related
to prescription drugs, hospice care, and medical savings account plans.”°

Legacy Medicare Reform. Legislation reforming legacy (non-MA)

Medicare should:

Base payments on the health status of the patient or intensity of the
service rather than where the patient happens to receive that service.

Replace the bureaucrat-driven fee-for-service system with value-
based payments to empower patients to find the care that best serves
their needs.

Codify price transparency regulations.

Restructure 340B drug subsidies” toward beneficiaries rather
than hospitals.

Repeal harmful health policies enacted under the Obama and Biden
Administrations such as the Medicare Shared Savings Program” and

Inflation Reduction Act.”

Medicare Part D Reform. The Inflation Reduction Act (IRA) created a drug

price negotiation program in Medicare that replaced the existing private-sector

negotiations in Part D with government price controls for prescription drugs.

These government price controls will limit access to medications and reduce

patient access to new medication.

This “negotiation” program should be repealed, and reforms in Part D that

will have meaningful impact for seniors should be pursued. Other reforms should

include eliminating the coverage gap in Part D, reducing the government share in

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the catastrophic tier, and requiring manufacturers to bear a larger share. Until the
IRA is repealed, an Administration that is required to implement it must dosoina
way that is prudent with its authority, minimizing the harmful effects of the law’s
policies and avoiding even worse unintended consequences.*°

Medicaid. Over the past 45 years, Medicaid and the health safety net have
evolved into a cumbersome, complicated, and unaffordable burden on nearly every
state. The program is failing some of the most vulnerable patients; is a prime target
for waste, fraud, and abuse; and is consuming more of state and federal budgets.
The dramatic increase in Medicaid expenditures is due in large part to the ACA
(Obamacare), which mandates that states must expand their Medicaid eligibility
standards to include all individuals at or below 138 percent of the federal poverty
level (FPL), and the public health emergency, which has prohibited states from
performing basic eligibility reviews.

The overlap of available benefits among the various health agencies has led
to a complex, confusing system that is nearly impossible to navigate—even for
recipients. Recipients are often faced with a “welfare cliff” of benefit losses as they
earn above a certain amount, which is contrary to the fundamental purpose of
empowering individuals to achieve economic independence. Benefits increasingly
involve nonmedical services such as air conditioning and housing, many of which
are already handled by departments other than HHS.

Improper payments within Medicaid are higher than those of any other federal
program. These payments are evidence of the inappropriateness of Medicaid’s
expansion, which, stemming largely from public health emergency maintenance
of effort (MOE) requirements and the Affordable Care Act, has crowded out the
primary targets of these programs: those who are most in need.

True health care reform cannot be accomplished in a bureaucratic silo or only
through Medicaid and health safety net programs. Reform of the tax code is also
essential to genuine, effective reform of our health care system. All components
of the health care system should be part of the reform efforts, and it is imperative
that the system be modified to assist states with their current programs. Therefore,
the next Administration should:

e Reform financing. Allow states to have a more flexible, accountable,
predictable, transparent, and efficient financing mechanism to deliver
medical services. This system should include a more balanced or blended
match rate, block grants, aggregate caps, or per capita caps. Any financial
system should be designed to encourage and incentivize innovation and
the efficient delivery of health care services. Federal and state financial
participation in the Medicaid program should be rational, predictable, and
reasonable. It should also incentivize states to save money and improve the
quality of health care.

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Direct dollars to beneficiaries more effectively and responsibly. The

current funding structure for the Medicaid program rewards expansions,

lacks transparency, and promotes financing gimmicks. CMS should:

End state financing loopholes.
Reform payments to hospitals for uncompensated care.

Replace the enhanced match rate with a fairer and more
rational match rate.

Restructure basic financing and put the program on a more fiscally
predictable budget (which should include reform of Disproportionate
Share Hospital payments to hospitals).*!

Strengthen program integrity. Make program integrity a top priority and
the responsibility of the states. To protect the taxpayers’ investment:

Incentivize states. An enhanced contingency fee should be paid to
states that successfully increase their efforts to decrease waste, fraud,
and abuse. The current system’s IT development 90/10 matching rate
should be allowed for improvements in states’ current fraud and abuse
and eligibility systems. Innovative programs that show a positive return
on investment for both the state and federal governments should be
allowed without the onerous waiver process.

Improve Medicaid eligibility standards to protect those in need.
As Medicaid enrollment continues to climb, it is imperative that there
are appropriate and accurate eligibility standards to ensure that the
program remains focused on serving those who are in need. To this
end, CMS should:

a. Hold states accountable for improper eligibility determinations.
b. Require more robust eligibility determinations.

c. Strengthen asset test determinations within Medicaid.”

Conduct oversight and reform of managed care.”

Incentivize personal responsibility. CMS should allow states to ensure

that Medicaid recipients have a stake in their personal health care anda

say in decisions related to the Medicaid program. Personal responsibility

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and consumer choice for Medicaid recipients must go together as standard
components of the safety net, especially for able-bodied recipients.
Medicaid recipients, like the rest of Americans, should be given both the
freedom to choose their health plans and the responsibility to contribute to
their health care costs at a level that is appropriate to protect the taxpayer.

Add work requirements and match Medicaid benefits to beneficiary
needs. Because Medicaid serves a broad and diverse group of individuals, it
should be flexible enough to accommodate different designs for different
groups. For example, CMS should launch a robust “personal option” to allow
families to use Medicaid dollars to secure coverage outside of the Medicaid
program. CMS should also:

1. Clarify that states have the ability to adopt work incentives for able-
bodied individuals (similar to what is required in other welfare
programs) and the ability to broaden the application of targeted
premiums and cost sharing to higher-income enrollees.

2. Add targeted time limits or lifetime caps on benefits to disincentivize
permanent dependence.**

Allow private health insurance. Congress should allow states the option
of contributing to a private insurance benefit for all members of the family
in a flexible account that rewards healthy behaviors. This reform should also
allow catastrophic coverage combined with an account similar to a health
savings account (HSA) for the direct purchase of health care and payment of
cost sharing for most of the population.

Increase flexible benefit redesign without waivers. CMS should

add flexibility to eliminate obsolete mandatory and optional benefit
requirements and, for able-bodied recipients, eliminate benefit mandates
that exceed those in the private market. This should include flexibility to
redesign eligibility, financing, and service delivery of long-term care to serve
the most vulnerable and truly needy and eliminate middle-income to upper-
income Medicaid recipients.

Eliminate current waiver and state plan processes. CMS should
allow providers to make payment reforms without cumbersome waivers
or state plan amendment processes where possible. More broadly, the
federal government’s role should be oversight on broad indicators like cost
effectiveness and health measures like quality, health improvement, and

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wellness and should give the balance of responsibility for Medicaid program
management to states. This reform would include adding Section 1115*°
waiver requirements in some cases (such as imposing work requirements
for able-bodied adults) while rescinding requirements in others (such as
non-health care benefits and services related to climate change).

AFFORDABLE CARE ACT AND PRIVATE HEALTH INSURANCE

Remove barriers to direct primary care. Direct primary care (DPC)

is an innovative health care delivery model in which doctors contract
directly with patients for their care on a subscription basis regardless of
how or where the care is provided. The DPC model is improving patient
access, driving higher quality and lower cost, and strengthening the doctor-
patient relationship. DPC has faced many challenges from government
policymakers, including overly exuberant attempts at regulation and
misclassification. Changes should clarify that DPC’s fixed fee for care does
not constitute insurance in the context of health savings accounts.*°

Revisit the No Surprises Act on surprise medical billing. The No
Surprises Act*’ protected consumers against balance bills, but it also
established a deeply flawed system for resolving payment disputes between
insurers and providers. This government-mandated dispute resolution
process has sown confusion among arbiters and regulators as judges have
sought to ascertain its meaning. The No Surprises Act should scrap the
dispute resolution process in favor of a truth-in-advertising approach

that will protect consumers and free doctors, insurers, and arbiters from
confused and conflicting standards for resolving disputes that the disputing
parties can best resolve themselves.**

Facilitate the development of shared savings and reference pricing
plan options. Under traditional insurance, patients who choose lower-
cost care do not benefit financially from that choice. Barriers to rewarding
patients for cost-saving decisions should be removed. CMS should ensure
that shared savings and reference pricing models that reward consumers
are permitted.

Separate the subsidized ACA exchange market from the non-
subsidized insurance market. The Affordable Care Act has made
insurance more expensive and less competitive, and the ACA subsidy
scheme simply masks these impacts. To make health insurance coverage
more affordable for those who are without government subsidies, CMS
should develop a plan to separate the non-subsidized insurance market

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from the subsidized market, giving the non-subsidized market regulatory
relief from the costly ACA regulatory mandates.”

e Strengthen hospital price transparency. In 2020, CMS completed its
rule to require hospitals to post the prices of common hospital procedures.”
Future updates of these rules should focus on including quality measures.
Combined with the shared savings models and other consumer tools, these
efforts could deliver considerable savings for consumers.”

Center for Consumer Information and Insurance Oversight (CCHO).
CMS also plays an outsized role in overseeing the Obamacare exchanges, includ-
ing managing Healthcare.gov, through the Center for Consumer Information and
Insurance Oversight (CCIIO). While Obamacare limits plan options, CCIIO has
been overly prescriptive in dictating what benefits and types of health plans may
participate in the exchanges, thereby actually stifling market innovation and driv-
ing up costs.

Congress should build on the Trump Administration’s efforts to expand choices
for small businesses and workers, both in and out of the exchanges, by codifying an
expansion of association health plans, short-term health plans, and health reim-
bursement arrangements (including individual coverage HRAs). CCIIO should also
work with the Treasury Department and the Office of Management and Budget
(OMB) to give consumers more flexibility with their health care dollars through
expanded access to health savings accounts.

EMERGENCY PREPAREDNESS

e Expand the scope of practice of low-complexity and moderate-
complexity clinical laboratories. During the COVID-19 pandemic,
allowing laboratories greater regulatory flexibility regarding CLIA
requirements increased access to testing. However, the need for regulatory
flexibility is not limited to emergency situations. Ongoing innovations
in medical care will continue to drive demand for clinical testing and
new tests. One way that increasing demand for other medical services
has been accommodated is by revising restrictions on scope of practice
to enable providers to practice at the so-called top of their license. CMS
should similarly revise CLIA rules regarding scope of practice for clinical
laboratories and testing personnel.”

e Create CLIA-certification-equivalent pathways for non-clinical
laboratories and researchers. The COVID-19 pandemic revealed that
the U.S. needs to leverage the expertise of non-clinical laboratories and
researchers in order to bolster clinical testing capacity. To accomplish this,

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CMS should create pathways for granting non-clinical laboratories and their
testing personnel CLIA certification equivalency. Non-clinical researchers
already demonstrate their technical expertise through online training and
certification programs. CMS should build on that existing framework so that
those laboratories and personnel can similarly demonstrate their clinical
testing capabilities.*

LIFE, CONSCIENCE, AND BODILY INTEGRITY

Prohibit abortion travel funding. Providing funding for abortions
increases the number of abortions and violates the conscience and religious
freedom rights of Americans who object to subsidizing the taking of life. The
Hyde Amendment* has long prohibited the use of HHS funds for elective
abortions, but an August 2022 Biden executive order* pressed the HHS
Secretary to use his authority under Section 1115 demonstrations to waive
certain provisions of the law in order to use taxpayer funds to achieve the
Administration’s goal of helping women to travel out of state to obtain
abortions. Moreover, the Department of Justice Office of Legal Counsel
(DOJ OLC) issued a politicized legal opinion declaring, for the first time in
the history of Hyde, that this action did not violate the Hyde Amendment
and that Hyde applies only to the performance of the abortion itself in
violation of the plainly broad language that Congress used.

Two of the first actions of a pro-life Administration should be for HHS

to withdraw the Medicaid guidance (and any Section 1115 waivers issued
thereunder) and for DOJ OLC to withdraw and disavow its interpretation of
the Hyde Amendment.

Prohibit Planned Parenthood from receiving Medicaid funds. During
the 2020-2021 reporting period, Planned Parenthood performed more than
383,000 abortions.*° The national organization reported more than $133
million in excess revenue” and more than $2.1 billion in net assets.** During
this same year, Planned Parenthood reports that its affiliates received more
than $633 million in government funding and more than $579 million in
private contributions.*? Planned Parenthood affiliates face accusations of
waste, abuse and potential fraud with taxpayer dollars, failure to report

the sexual abuse of minor girls, and allegations of profiting from the sale of
organs from aborted babies.

Policymakers should end taxpayer funding of Planned Parenthood and

all other abortion providers and redirect funding to health centers that
provide real health care for women. The bulk of federal funding for Planned

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Parenthood comes through the Medicaid program. HHS should take two
actions to limit this funding:

1. Issue guidance reemphasizing that states are free to defund Planned
Parenthood in their state Medicaid plans.

2. Propose rulemaking to interpret the Medicaid statute to disqualify
providers of elective abortion from the Medicaid program.

Congress should pass the Protecting Life and Taxpayers Act,°° which
would accomplish the goal of defunding abortion providers such as
Planned Parenthood.

CMS should resolve pending Section 1115 waivers from Idaho, South Carolina,
and Tennessee, which, like Texas in January 2022, are seeking both to prohibit
abortion providers from participating in state-run Medicaid programs and to
work with other states to do the same. Abortion is not health care, and states
should be free to devise and implement programs that prioritize qualified
providers that are not entangled with the abortion industry.

Withdraw Medicaid funds for states that require abortion insurance
or that discriminate in violation of the Weldon Amendment. The
Weldon Amendment” declares that no HHS funding may go to a state

or local government that discriminates against pro-life health entities

or insurers. In blatant violation of this law, seven states require abortion
coverage in private health insurance plans, and HHS continues to fund
those states. HHS under President Trump disallowed $200 million in
Medicaid funding from California because of the state’s flouting of the law,
but the Biden Administration restored it.

HHS/CMS should withdraw appropriated funding, up to and including 10
percent of Medicaid funds, from states that require abortion insurance
coverage. DOJ should commit to litigating the defense of those funding
decisions promptly to the Supreme Court in order to maximize HHS’s
ability to withdraw funds from entities that violate the Weldon Amendment.

Additionally, California has announced that it will discriminate against
pharmacies that do not carry chemical abortion drugs outside of California.
California’s discrimination takes the form of cutting state contracts with
such pharmacies and clearly violates the Weldon Amendment. The violation
should likewise face the penalties discussed above.

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Rewrite the ACA abortion separate payment regulation. Section 1303
of Obamacare requires that insurers collect a separate payment for certain
abortion coverage in qualified health plans that are approved to be sold on
exchanges and that they keep those separate payments in separate accounts
that are used only to pay for elective abortion services. Neither the letter
nor the spirit of the law was enforced under President Obama, and a Trump-
era regulation sought to correct this problem. The Biden HHS rescinded
this regulation to allow insurance companies once again—contrary to

the law—to collect combined payments for what are clearly required to

be separate payments for elective abortion coverage. “Separate” does not
mean “together.”

HHS should reinstate a Trump Administration regulation and enforce what
the plain text of Section 1303 requires. That regulation should be further
improved by requiring CMS to ensure that consumers pay truly separate
charges for abortion coverage.

Audit Hyde Amendment compliance. HHS should undertake a full audit
to determine compliance or noncompliance with the Hyde amendment and
similar funding restrictions in HHS programs. This audit should include a
full review of the Biden Administration’s post-Dobbs executive actions to
promote abortion. It should also encompass a review of Medicaid managed
care plans in pro-abortion states.

Reverse distorted pro-abortion “interpretations” added to the
Emergency Medical Treatment and Active Labor Act. The Emergency
Medical Treatment and Active Labor Act (EMTALA)*” prohibits hospitals
that receive Medicare funds from “dumping” emergency patients who
cannot pay by sending them to other hospitals. It also mandates that
hospitals stabilize pregnant women and explicitly protects unborn children.
Hospitals or physicians found to be in violation of the statute could lose

all of their federal health funding—Medicare, Medicaid, CHIP, and other
funds—and face civil penalties of up to nearly $120,000.

In July 2022, HHS/CMS released guidance mandating that EMTALA-
covered hospitals and the physicians who work there must perform
abortions, to include completing chemical abortions even when the child
might still be alive. The guidance also declared that EMTALA would
protect physicians and hospitals that perform abortions in violation of
state law if they deem those abortions necessary to stabilize the women’s
health. This novel interpretation of EMTALA is baseless. EMTALA requires

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no abortions, preempts no pro-life state laws, and explicitly requires
stabilization of the unborn child.

HHS should rescind the guidance and end CMS and state agency
investigations into cases of alleged refusals to perform abortions. DOJ
should agree to eliminate existing injunctions against pro-life states,
withdraw its enforcement lawsuits, and in lawsuits against CMS on the
guidance agree to injunctions against CMS and withdraw appeals of
injunctions.

Reissue a stronger transgender national coverage determination.
CMS should repromulgate its 2016 decision that CMS could not issue a
National Coverage Determination (NCD) regarding “gender reassignment
surgery” for Medicare beneficiaries. In doing so, CMS should acknowledge
the growing body of evidence that such interventions are dangerous and
acknowledge that there is insufficient scientific evidence to support such
coverage in state plans.

Enforce EMTALA. The undeniable reality of abortion is that it does do
not always result in a dead baby, and these born-alive babies are left to

die. HHS should use EMTALA and Section 504 of the Rehabilitation Act,*?
which prohibits disability discrimination, to investigate instances of infants
born alive and left untreated in covered hospitals. CMS, OCR, and OIG
should be required to follow through on these investigations with specific
enforcement actions.

HHS should revive a Trump Administration proposed regulation,

“Special Responsibilities of Medicare Hospitals in Emergency Cases and
Discrimination on the Basis of Disability in Critical Health and Human
Service Programs or Activities,”** to achieve this end. In addition, Congress
should pass the Born-Alive Abortion Survivors Protection Act* to require
that proper medical care be given to infants who survive an abortion
and to establish criminal consequences for practitioners who fail to
provide such care.

Permanently codify both the Hyde family of amendments and the
protections provided by the Weldon Amendment. Congress can
accomplish this through legislation such as the No Taxpayer Funding for
Abortion and Abortion Insurance Full Disclosure Act** (Hyde) and the
Conscience Protection Act®” (Weldon).

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Radical Redefinition of Sex. On August 4, 2022, HHS published a proposed
rule entitled “Nondiscrimination in Health Programs and Activities.”** This rule
addresses nondiscrimination provisions of the Affordable Care Act, known as
Section 1557, which is enforced by the Office for Civil Rights and the Centers for
Medicare and Medicaid Services. Section 1557 prohibits discrimination on the basis
of race, color, national origin, age, disability, and sex in covered health programs
or activities.

Under the proposed rule, sex is redefined: “Discrimination on the basis of sex
includes, but is not limited to, discrimination on the basis of sex stereotypes; sex
characteristics, including intersex traits; pregnancy or related conditions; sexual
orientation; and gender identity.”*’ In other words, the department proposes to
interpret Section 1557 as if it created special privileges for new classes of people,
defined in ways that are highly ideological and unscientific.

The redefinition of sex to cover gender identity and sexual orientation and
pregnancy to cover abortion should be reversed in all HHS and CMS programs as
was done under the Trump Administration. This includes the Children’s Health
Insurance Program (CHIP). Low-income families who rely on CHIP should not be
coerced, pressured, or otherwise encouraged to embrace this ideologically moti-
vated sexualization of their children.

However, while the Biden Administration’s Section 1557 regulation should be
altered and corrected, the lactation room requirements added in the regulation
should either be consistently included in any upcoming Section 1557 rulemaking
or be proposed in a new individual rule.

COVID-19 Vaccination and Mask Requirements. Health care workers were
praised for their self-sacrifice in caring for sick patients at the beginning of the
COVID-19 pandemic, but then they were fired if they objected to receiving COVID-
19 vaccines with or without complying with onerous masking requirements and
regardless of whether they already had the virus and had gained natural immunity.
With the disease being endemic and constantly mutating, vaccines and univer-
sal masking in health care facilities do not have appreciable benefits in reducing
COVID-19 transmission throughout the community. Moreover, more recent
COVID strains pose fewer health risks than the earlier strains, and the pandemic
has been declared to be at an end. CMS should:

e Announce nonenforcement of the Biden Administration’s COVID-19
vaccination mandate on Medicaid and Medicare hospitals.

e Revoke corresponding guidance and regulations.

e Refrain from imposing general COVID-19 mask mandates on health care
facilities or personnel.

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e Pay damages to all medical professionals who were dismissed directly
because of the CMS vaccine mandate.

ADMINISTRATION FOR CHILDREN AND FAMILIES (ACF)

TANF. The Temporary Assistance for Needy Families (TANF) program is a
federal block grant that gives states significant flexibility to fund a broad array of
programs aimed at helping low-income families break the cycle of poverty and
achieve economic self-sufficiency. States use TANF to fund monthly cash assis-
tance payments to low-income families with children as well as a wide range of
services that include work activities, work supports and supportive services, child-
care, administration and systems, tax credits, pre-K/Head Start, child welfare, and
other services.

The TANF program serves 1.8 million individuals. Since 1996, when the program
was reformed, federal TANF outlays have been $16.5 billion. The state match is
$14.9 billion, bringing the total state and federal TANF investment to $31.4 billion.

The TANF statute requires that states engage 50 percent of single-parent fam-
ilies in work for at least 30 hours a week (20 hours a week for single parents with
children under age six, though states have the option to waive the requirement
for families with children under the age of six, and most do). States also have 90
percent work requirements for two-parent families to engage in work for 35 hours
per week. Because of the “Caseload Reduction Credit,” states’ work engagement
targets are reduced if their assistance caseloads have fallen since 2005. As a result,
21 states had a work engagement target of zero percent in 2017.

Generally, states apply their work requirement only to beneficiaries receiv-
ing basic assistance, who account for 22.3 percent of TANF outlays. The Trump
Administration proposed a Supplemental Nutrition Assistance Program (SNAP)
rule to “increase program integrity and reduce fraud, waste, and abuse” that would
have prevented an individual from qualifying for SNAP simply because he or she
received a pamphlet from the TANF program.” This rule defined non-cash benefits
as those that are worth at least $50 a month and received for at least six months.
The tenets of this rule should be applied to the TANF program as well. This defi-
nitional change would apply the TANF work requirements to any noncash benefit
worth $50 a month and received for six consecutive months.

To increase transparency, HHS should clarify how states, in their quarterly and
annual reports, ought to track and audit the outcomes from how they spend TANF
funds to meet the TANF program’s four statutory purposes.

Additionally, TANF priorities are not implemented in an equally weighted
way. Marriage, healthy family formation, and delaying sex to prevent pregnancy
are virtually ignored in terms of priorities, yet these goals can reverse the cycle
of poverty in meaningful ways. CMS should require explicit measurement of
these goals.

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Teen Pregnancy Prevention (TPP) and Personal Responsibility Educa-
tion Program (PREP). TPP is operated by the Office of Population Affairs in the
Office of the Assistant Secretary for Health; PREP is operated by the ACF Office
of Planning, Research, and Evaluation. Both programs should ensure that there
is better reporting of subgrantees and referral lists so that they do not promote
abortion or high-risk sexual behavior among adolescents. CMS should ensure that
Sexual Risk Avoidance (SRA) proponents receive these grants and are given every
opportunity to prove their effectiveness. SRA programs, both at ACF and at OASH
and both discretionary and mandatory, should be equal in funding and emphasis.
Qualitative research should be conducted on both types of programs to ensure
continuous improvement.

In addition, certain provisions should be employed so that these programs do
not serve as advocacy tools to promote sex, promote prostitution, or provide a
funnel effect for abortion facilities and school field trips to clinics, or for similar
purposes. Parent involvement and parent-child communication should be encour-
aged and bea part of any funded project. Risk avoidance should be prioritized, and
any program that submits a proposal that promotes risk rather than health should
not be eligible for funding.

Site visits should be revamped to ensure adherence to these optimal health met-
rics, and a cost analysis of programming as compared to students served should be
a metric in funding (taking into account that in certain cases, intensive programs
will serve fewer students and can have more positive results). These same param-
eters should apply to sex education programs at ACF. Any lists with “approved
curriculum” or so-called evidence-based lists should be abolished; HHS should
not create a monopoly of curriculum, adding to the profit of certain publishers.
Furthermore, lists created in the past have given priority to sex-promotion text-
books. HHS should create a list of criteria for evaluating the sort of curriculum
that should be selected for any sex education grant programs, both at OASH and
at ACF, with the aim of promoting optimal health and adhering to the legislative
language of each program.

Adoption Reform. There are roughly 400,000 children across the nation on the
waiting list for foster care and 100,000 awaiting adoptive families, and the opioid/
fentanyl crisis is putting more at risk every day. Unfortunately, many of the faith-
based adoption agencies that serve these children are under threat from lawsuits,
or else their licenses and contracts have been halted because they cannot in good
conscience place children in every household due to their religious belief that a
child should have a married mother and father.

HHS, through ACF and the Assistant Secretary for Financial Resources (ASFR),
should repeal the unnecessary 2016 regulation® that imposes nonstatutory sexual
orientation and gender identity nondiscrimination conditions on agency grants
and return to the policy of maximizing the options for placing vulnerable children

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in their forever homes. ACF and OCR should also survey their programs to consider
whether additional waivers of HHS grant conditions—waivers the Biden Admin-
istration revoked in 2021—are needed for faith-based agencies.

Additionally, Congress should pass the Child Welfare Provider Inclusion Act® to
ensure that providers and organizations cannot be subjected to discrimination for
providing adoption and foster care services based on their beliefs about marriage.

Office of Refugee Resettlement (ORR). The Office of Refugee Resettlement
should be moved to the Department of Homeland Security. Having health and
welfare functions managed by HHS and border security functions managed by
DHS has created intolerable failures in both. HHS and ORR have forgotten their
original refugee-resettlement mission and instead have provided a panoply of free
programs that incentivize people to come to the U.S. illegally. Even more troubling,
ORR has too often placed children into dangerous situations when releasing them
into the country.

Nearly all of HHS’s care, custody, and placement of children is done through
cooperative agreements with private agencies, many of which may have broken
federal law by inducing or being accomplices in illegal immigration. Those
arrangements could be handled far more effectively by DHS. Congress should
reform the Trafficking Victims Protection Reauthorization Act® to transfer all
ORR duties for unaccompanied alien children to DHS and eliminate the Flores
settlement agreement.”

Regardless of where ORR’s functions reside, ORR staff and care providers should
never be allowed to facilitate abortions for unaccompanied children in its cus-
tody, including by transporting minors across state lines from pro-life states to
abortion-friendly states. Pregnant, unaccompanied girls in ORR custody should
be treated with dignity, not trafficked across state lines to be victimized by the
abortion industry. ORR should withdraw its policy of allowing elective abortions
for children in ORR care and issue a new policy of instructing care providers not
to allow girls to be transported for elective abortions. HHS OGC and the White
House should insist that DOJ fight to defend that policy up to the U.S. Supreme
Court in light of Dobbs.

Office of Child Support Enforcement (OCSE) Congress established Aid to
Families with Dependent Children in 1935 to assist single-parent families who
were suffering financially from the loss of a bread-winning husband and father.
Within two decades, however, the majority of families receiving aid were depen-
dent because of paternal abandonment rather than death. Today, nearly a third of
America’s children live without a father present in the home, and a fourth of them
are enrolled to receive child support.

The glaring issue in child support enforcement today is a non-resident father’s
ability to provide full or consistent child support payments. The literature reflects
this divide as fathers have been categorized as “deadbeat” dads, then as “deadbroke”

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dads, and now as “disconnected” dads who do not commit to the mother and child.
Child support in the United States should strengthen marriage as the norm, restore
broken homes, and encourage unmarried couples to commit to marriage.

Child Support Tax Credit. National or state guidelines and tax law should be
updated to ensure that nonresident parents with child support orders can receive
anondependent, child support tax credit. Single filers of up to $41,756 and married
or joint filers of up to $47,646 would be eligible for a child support tax credit similar
to the current earned income tax credit. Filers could receive a maximum of $538
in annual returns for one child and a maximum of $3,584 in annual returns for two
or more children (based on a credit rate of 34 percent). A child support tax credit
would use the low-income, nonresident parents’ own earned income and history
of employment to assist them further in the task of caring for their children.

The key to this policy is that it empowers fathers with their own resources and
money rather than creating another government assistance program (or a fully
refundable credit) devoid of the father’s own monetary efforts. This way, the non-
resident father’s role as financial provider and relational figure is affirmed, and
much-needed financial resources are given to the children.

Visitation. Visitation is key to revitalizing child support and increasing pay-
ment frequency. The most effective way to lower a nonresident parent’s monthly
child support order is to spend more court-accounted-for time with the child. For
example, Texas combined its child support court with its visitation court to ensure
that resident and nonresident parents received state-mandated financial support
orders and enforceable visitation orders.

Child Support Payment and Interactive Smartphone Application. Each
state should be induced to implement a high-tech, easy-to-use application to cen-
tralize child support payments. As with Venmo or Cash App, nonresident parents
would link their bank accounts and provide one-click monthly payments (or con-
tribute incrementally throughout the month while tracking how much is due).
Additionally, the nonresident parents could track “informal” gifts from money,
groceries, clothes, sports gear, and more through the app.

This would address one of the main issues within current child support pay-
ment systems: nonresident parents claim that they are spending much of their
own money to provide for children outside of their monthly payments and resident
parents’ claim that they spend little and neglect their official child support orders.
Currently, only the latter claim can be tracked reliably. This process would enable
nonresident parents to track the amount of informal support they provide and the
reason for it while ensuring that the resident parent acknowledges and accepts
the contribution.

Healthy Marriage and Relationship Education (HMRE) Program. The
HMERE program is part of the ACF Office of Family Assistance. The following pol-
icies should be implemented.

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Utilize HMRE funding or grants to provide state-level high school
education resources and curriculum on healthy marriages, sexual
risk avoidance, and healthy relationships. Early interventions and
prevention are much more cost-effective than are efforts to reach people
already in broken relationships.

Allow child welfare funding to be used for marriage and relationship
education. Congress should adopt the following recommendation from a
report issued by members of Congress’s Joint Economic Committee:

Children are far more likely to experience abuse when they are raised
outside of their married-parent family. Title II of the Child Abuse Preven-
tion and Treatment Act provides grants to communities for the purpose
of preventing child abuse and neglect, and one of the stated purposes

for which the grants can be used is for efforts to increase family stability.
However, Congress could change the law to make it clear that Title II
funding can be used for healthy marriage and relationship education.

Funding provided under Title IV-B of the Social Security Act—which
provides grants to states for foster care and adoption services—can also
be used for promoting healthy marriage. States should consider using
some of their Title IV-B funding for providing healthy marriage and
relationship education for families at risk of having their children placed
in foster care.

Provide educational information on healthy marriage and
relationships at Title X family planning clinics. HHS should require
clinics it funds under Title X (family planning) to provide information
to customers about the importance of marriage to family and personal
well-being and refer them to available federal, state, and nonprofit
marriage resources.

Ensure proper assessments with enough time to assess HMRE
programs. Although some widely available assessments of HMRE
programs report poor outcomes, many of these assessments either utilized a
poor methodology or tried to measure program success prematurely. Recent
assessments have shown increasing effectiveness and positive community-
level marital outcomes.”

The HMRE program should receive a fair and realistic assessment.
Additionally, the positive role of faith-based programs should be protected

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and prioritized so that these programs do not receive undue scrutiny or
pressure to conform to nonreligious definitions of marriage and family as
put forward by the recently enacted Respect for Marriage Act.”

e Protect faith-based grant recipients from religious liberty violations
and maintain a biblically based, social science-reinforced definition
of marriage and family. Social science reports that assess the objective
outcomes for children raised in homes aside from a heterosexual, intact
marriage are clear: All other family forms involve higher levels of instability
(the average length of same-sex marriages is half that of heterosexual
marriages); financial stress or poverty; and poor behavioral, psychological,
or educational outcomes.

For the sake of child well-being, programs should affirm that children
require and deserve both the love and nurturing of a mother and the play
and protection of a father. Despite recent congressional bills like the
Respect for Marriage Act that redefine marriage to be the union between
any two individuals, HMRE program grants should be available to faith-
based recipients who affirm that marriage is between not just any two adults,
but one man and one unrelated woman.

Healthy Marriage and Responsible Fatherhood (HMRF) Program. This
program is located within the ACF Office of Family Assistance. Its goal, like that
of the HMRE program, is to provide marriage and parenting guidance for low-in-
come fathers. This includes fatherhood and marriage training, curriculum, and
subsequent research.

e Implement a pro-fatherhood messaging campaign. With nearly 41
percent of children born without a married father in the home (and nearly
69 percent among black Americans), the fatherhood problem is clear.
Similar to Florida Governor Ron DeSantis’s 2022 fatherhood bill, HMRF
funds should be used to support national messaging campaigns that affirm
the role fathers play in the lives of their children, that recognize the financial
hardships the fathers themselves face, and that seek to provide relationship
education to fathers who were raised without a father in the home.

e Fund effective HMRF state programs. Grant allocations should protect
and prioritize faith-based programs that incorporate local churches and
mentorship programs or increase social capital through multilayered
community support Gncluding, for example, job training and social
events). Programs should affirm and teach fathers based on a biological and

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sociological understanding of what it means to be a father—not a gender-
neutral parent—from social science, psychology, personal testimonies, etc.

ADMINISTRATION ON CHILDREN, YOUTH, AND FAMILIES (ACYF)

Allocate funding to strategy programs promoting father involvement
or terminate parental rights quickly. ACYF is currently considering
different programs to encourage parents, especially fathers, to engage with
their children in foster care. While these program ideas and initiatives are
still in the early planning stages, promoting responsible parenthood to
reintegrate children or at least keep a consistent male figure in the minor’s
life is crucial. At the same time, in cases where the father or mother does
not make a sincere or serious effort to be involved in the child’s upbringing,
termination of parental rights for children in foster care should be swift.

OFFICE OF HEAD START (OHS)

Eliminate the Head Start program. Head Start, originally established

and funded to support low-income families, is fraught with scandal and
abuse. With a budget of more than $11 billion, the program should function
to protect and educate minors. Sadly, it has done exactly the opposite. In
fact, “approximately 1 in 4 grant recipients had incidents in which children
were abused, left unsupervised, or released to an unauthorized person
between October 2015 and May 2020.”° Research has demonstrated that
federal Head Start centers, which provide preschool care to children from
low-income families, have little or no long-term academic value for children.
Given its unaddressed crisis of rampant abuse and lack of positive outcomes,
this program should be eliminated along with the entire OHS. At the very
least, the program’s COVID-19 vaccine and mask requirements should

be rescinded.

ADMINISTRATION FOR COMMUNITY LIVING (ACL)

Support palliative care. Physician-assisted suicide (PAS) is legal in 10
states and the District of Columbia. Legalizing PAS is a grave mistake that
endangers the weak and vulnerable, corrupts the practice of medicine
and the doctor-patient relationship, compromises the family and
intergenerational commitments, and betrays human dignity and equality
before the law. Instead of embracing PAS, policymakers should focus on
the benefits of palliative care, which works to improve a patient’s quality
of life by alleviating pain and other distressing symptoms of a serious
illness. HHS ACL should survey their programs to ensure that they are
supporting vulnerable persons of age or disability and are not facilitating or
encouraging participation in PAS.

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Readdress the National Strategy to Support Family Caregivers. While
in theory the strategy aims to support family members with duties to care
for older family members, the plan is overly focused on racial and “LGBTQ+
equity.” The strategy should be examined to establish an efficient plan to
support caregivers and their families. There should also be a review of its
COVID-19 policies.

HEALTH RESOURCES AND SERVICES ADMINISTRATION (HRSA)

Congress should allow CMS to use the 340B data that HRSA collects
rather than having CMS conduct its own survey, especially in view

of the U.S. Supreme Court’s American Hospital Association v. Becerra
decision.” The legislation should also create penalties for those who do not
respond to HRSA’s data collection.

Legally define the locus of service as where the provider is located
during the telehealth visit rather than where the patient is. With such
a definition, states could continue to reserve their powers to establish the
standards for licensure and scope of practice. The providers could ensure
continuity and consistency of care no matter where their patients might
move while maintaining the licenses that make the most sense for them.

Americans are far more mobile and technologically advanced today than
they were when most health care laws were written. Telehealth has become
increasingly important, particularly during the height of the COVID-19
pandemic. It also has great potential in rural and other areas where there
are shortages of health care providers. HRSA’s Office for the Advancement
of Telehealth includes a program known as the Licensure Portability Grant
Program, which bolsters state efforts to reform licensing laws to maximize
telehealth flexibility. HRSA does not have the authority through this office
to dictate licensure laws; that power has typically been reserved to the
states. However, telehealth across state lines, when permitted, is interstate
commerce, which can be regulated by the federal government according to
the Constitution.

Restore Trump religious and moral exemptions to the contraceptive
mandate (also a CMS rule). HHS should rescind, if finalized, the
regulation titled “Coverage of Certain Preventive Services Under the
Affordable Care Act,” proposed jointly by HHS, Treasury, and Labor.”° This
rule proposes to amend Trump-era final rules regarding religious and
moral exemptions and accommodations for coverage of certain preventive
services under the ACA. Preventive services include contraception, and

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it appears the proposed rule would change the existing regulations for
religious and moral exemptions to the ACA’s contraception mandate.
There is no need for further rulemaking that curtails existing exemptions
and accommodations.

Require HRSA to use rulemaking to update the women’s preventive
services mandate. The contraceptive mandate issued under Obamacare
has been the source of years of egregious attacks on many Americans’
religious and moral beliefs. The mandate was issued as part of the women’s
preventive services guidelines, which were issued without any rulemaking
that involved public notice and an opportunity to comment. Instead, HRSA
issued and changed the mandate by simply posting changes to its website.
HRSA also started off not requiring coverage of fertility awareness—based
methods of family planning, then requiring them, and then removing the
requirement without notifying the public. A federal judge recently ruled
that this failure to undergo notice and comment in issuing the mandate

is unlawful. HRSA should be required to repromulgate any women’s
preventive services mandates through the notice and comment process that
is compliant with the Administrative Procedures Act.

Moreover, since the Obama Administration HRSA entered into long-

term contracts with the pro-abortion American College of Obstetricians

and Gynecologists (ACOG) and related entities to serve as an exclusive
adviser with respect to the content of this mandate, HRSA has used

this arrangement to ignore comments that members of the public were
sometimes able to submit in the process, and ACOG has abused its

position to attack HHS’s allowance of religious and moral exemptions

to the contraceptive mandate. HHS should rescind these contracts and
establish an advisory committee that is compliant with the Federal Advisory
Committee Act and has members that are committed to women’s preventive
services and are not pro-abortion ideologues.

Expand inclusion of fertility awareness—based methods and supplies
to family planning in the women’s preventive services mandate. The
ACA requires coverage of and prevents insurance plans from imposing

any cost-sharing requirements on women who obtain preventive care and
screenings as defined by HRSA. In 2016, HHS included “instruction in
fertility awareness-based methods” as part of this requirement. However,
in December 2021, HHS removed that language from its list without

using the notice-and-comment process or giving any rationale, both of
which are mandated by the Administrative Procedures Act. In August

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2022, a federal court blocked this attempt to eliminate health insurance
coverage for fertility awareness—based methods of family planning from
requirements that cover at least 58 million women, and the judge made his
ruling permanent in December 2022. HRSA should promulgate regulations
consistent with this order.

HHS should more thoroughly ensure that fertility awareness—based
methods of family planning are part of women’s preventive services under
the ACA. FABMs often involve costs for materials and supplies, and HHS
should make clear that coverage of those items is also required. FABMs
are highly effective and allow women to make family planning choices ina
manner that meets their needs and reflects their values.

Eliminate men’s preventive services from the women’s preventive
services mandate. In December 2021, HRSA updated its women’s
preventive services guidelines to include male condoms after claiming for
years that it had no authority to do so because Congress explicitly limited
the mandate to “women’s” preventive care and screenings. HRSA should not
incorporate exclusively male contraceptive methods into guidelines that

specify they encompass only women’s services.

Eliminate the week-after-pill from the contraceptive mandate as a
potential abortifacient. One of the emergency contraceptives covered
under the HRSA preventive services guidelines is Ella (ulipristal acetate).
Like its close cousin, the abortion pill mifepristone, Ella is a progesterone
blocker and can prevent a recently fertilized embryo from implanting ina
woman’s uterus. HRSA should eliminate this potential abortifacient from
the contraceptive mandate.

Withdraw Ryan White guidance allowing funds to pay for cross-sex
transition support. HRSA should withdraw all guidance encouraging
Ryan White HIV/AIDS Program service providers to provide controversial
“gender transition” procedures or “gender-affirming care,” which cause
irreversible physical and mental harm to those who receive them.

Ensure that training for medical professionals (doctors, nurses, etc.)
and doulas is not being used for abortion training. HHS should ensure
that training programs for medical professionals—including doctors, nurses,
and doulas—are in full compliance with restrictions on abortion funding
and conscience-protection laws. In addition, HHS should:

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1. Investigate state medical school compliance with the Coats—-Snowe
Amendment,” which prohibits discrimination against health care
entities that do not provide or undergo training for abortion.

2. Ensure that the Accreditation Council for Graduate Medical Education
(ACGME) complies with all relevant conscience statutes and
regulations and that states have taken the affirmative steps (for example,
by issuing regulations) to assure compliance with Coats-Snowe.

3. Communicate to medical schools that any abortion-related training
must be on an opt-in rather than opt-out basis.

4. Require states that receive HHS funds to issue regulations or enter into
arrangements with accrediting bodies to comply with the Coats-Snowe
Amendment’s prohibition of mandatory abortion training by individuals
or institutions. The Coats-Snowe Amendment specifically requires
such state regulations or arrangements.

e =©6Prioritize funding for home-based childcare, not universal day care.
As HRSA’s Early Childhood Health page outlines, “Currently, only about
half of U.S. preschoolers are on-track with their development and ready
for school. And more than one in four of children (28%) who experience
abuse or neglect are under 3 years old.””? Concurrently, children who spend
significant time in day care experience higher rates of anxiety, depression,
and neglect as well as poor educational and developmental outcomes.
Instead of providing universal day care, funding should go to parents
either to offset the cost of staying home with a child or to pay for familial,
in-home childcare.

e Provide education and resources on early childhood health. By
partnering with new organizations like the Center on Child and Family
Poverty, HRSA should provide resources and information on the importance
of the mother-child relationship in child well-being. This should include
relationship education curricula that equip mothers and caregivers to
connect with and improve their understanding of their infants, toddlers, and
young children.

Maternal and Child Health. Currently, the HRSA Maternal and Child Health
program is collecting data on the benefits of doulas in improving the health, safety,
and emotional well-being of mothers at birth. Doulas provide a patient-focused,
nonmedical support system for single or married mothers that “decreases the

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overall cesarean rate by 50%, the length of labor by 25%, the use of oxytocin by
40%, and requests for an epidural by 60%. Doulas often use the power of touch
and massage to reduce stress and anxiety during labor.””

Given concerns about maternal mortality or postpartum depression that is
worsened by poor birth experiences, doulas should be an active option for all
women whether they are giving birth in a traditional hospital, through midwifery,
or at home. Additionally, since most Doulas’ services are not covered by traditional
insurance programs, the Maternal and Child Health program should work to pro-

vide funding for low-income mothers.

INDIAN HEALTH SERVICE (IHS)

The Indian Health Service serves our American Indian and Alaska Native popu-
lations. Reforms are needed to improve America’s ability to deliver on its promises
to these important populations and must take account of cultural preferences and
lifestyles, limitations due to geography (such as challenging terrain), and limited
Internet access. For example, contacting individuals within some of these com-
munities and tribes during the COVID-19 pandemic proved to be difficult because
many had transient addresses and unreliable cell service.

During the transition to the Biden Administration, IHS abandoned tribes as
their sources of COVID-19 tests and vaccine supplies disappeared. It is important
to guard against such situations in order to preserve these tribes’ access to health
resources during public health emergencies (PHEs). Even before the pandemic,
services available to these populations through federal resources and personnel
(such as vision care) were often scarce or nonexistent.

Patients in these populations should be empowered to rely on alternatives to
IHS through better access to private health care providers. Exploring positive
reforms contained in the VA MISSION Act” could reveal similar opportunities
for increased options and access for American Indians and Alaska Natives.

RURAL HEALTH

A growing concern is the decreasing access to health care services for Americans
living in rural, less populated areas. Many find themselves in regions that were not
previously as rural as industries move away, taking with them economic prosperity
and often medical providers. Others are in essential professions such as farming
that by nature necessitate living in regions with fewer city accommodations and
economic opportunities. Seeking space for one’s family and cultivating the land
are valued goals that are deeply rooted in America’s fabric.

Both Congress and an Administration must continually keep in mind how
health care policies uniquely affect these regions because their market trends
and populations are different from those of more populous regions. Often, rural
patients face an hour’s drive to the nearest medical provider or facility or have

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limited or no Internet access, which restricts their access to telehealth services
(especially video visits).
To improve its health care policies that affect rural regions, HHS should:

e Reduce the regulatory burden and unleash private innovation that can
discover solutions to unique, local needs.

e Implement or encourage policies that increase the supply of health care
providers, such as increased telehealth access and interstate licensure
(a historically state matter), including for volunteers wishing to provide
temporary, charitable services across state lines.

e Encourage flexibility in modes of health care delivery, including less
expensive alternatives to hospitals and telehealth independent of expensive
air ambulances.

OFFICE OF THE SECRETARY

The Secretary of Health and Human Services and the Office of the Secretary
necessarily set the tone for the entire department. The Secretary is the most
accountable individual within HHS and, along with his or her immediate staff,
should therefore be responsible for setting the policies that govern the depart-
ment’s operations instead of allowing the operational divisions to assume the
leading role in policymaking, thereby diffusing responsibility.

Practical reforms to enhance the Secretary’s accountability should include
the following:

e Restrict HHS’s ability to declare indefinite public health emergencies
(PHEs). Currently, HHS is merely required to notify Congress of sucha
declaration within 48 hours. Congress should establish a set time frame
for any PHE, placing on the Secretary the burden of proof as to why an
extension of the PHE is necessary.

e Reinstate the HHS SUNSET (Securing Updated and Necessary
Statutory Evaluations Timely) rule.” Congress should codify the now-
reversed Trump Administration rule that required all HHS agencies to
review regulations retrospectively and publish results; without such a
review, regulations expire.

e Investigate, expose, and remediate any instances in which HHS
violated people’s rights by:

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1. Colluding with Big Tech to censor dissenting opinions during COVID.

2. Colluding with abortion advocates and LGBT advocates to violate
conscience-protection laws and the Hyde Amendment.

The Life Agenda. The Office of the Secretary should eliminate the HHS Repro-
ductive Healthcare Access Task Force and install a pro-life task force to ensure
that all of the department’s divisions seek to use their authority to promote the life
and health of women and their unborn children. Additionally, HHS should return
to being known as the Department of Life by explicitly rejecting the notion that
abortion is health care and by restoring its mission statement under the Strategic
Plan and elsewhere to include furthering the health and well-being of all Americans

“from conception to natural death.”

The next Administration should create a dedicated Special Representative
for Domestic Women’s Health. In the Trump Administration, there was a Special
Representative for Global Women’s Health that focused on international issues,
but this position lacked authority to be the lead on international policies because
of overlapping issues with the U.S. Department of State and USAID (and at times
a lack of clarity as to the lead point of contact and policy decisions at the White
House). The new Special Representative would serve as the lead on all matters of
federal domestic policy development related to life and family with support from
the DPC for implementation and coordination among agencies. In the post-Dobbs
era, advancing support for mothers will include coordination among agencies out-
side of HHS, and the Special Representative would provide a clear focal point for
allissues related to protecting life and serving families.

The Family Agenda. The Secretary’s antidiscrimination policy statements
should never conflate sex with gender identity or sexual orientation. Rather, the
Secretary should proudly state that men and women are biological realities that
are crucial to the advancement of life sciences and medical care and that married
men and women are the ideal, natural family structure because all children have
aright to be raised by the men and women who conceived them.

OFFICE OF THE ASSISTANT SECRETARY FOR HEALTH
(OASH) / OFFICE OF THE SURGEON GENERAL (OSG)

The Assistant Secretary for Health (ASH) is the four-star admiral for the United
States Public Health Service Commissioned Corps (USPHS), and the Surgeon Gen-
eral (SG) is the three-star admiral.

The ASH is tasked with overseeing not only the USPHS, but also 10 regional
health offices, multiple presidential and secretarial advisory committees, and other
offices such as the Offices of Minority Health, Women’s Health, and Population
Affairs. The Secretary can further expand the ASH’s responsibilities (for example, by

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designating the ASH as liaison to the CDC). The SG officially oversees the daily oper-
ations of the USPHS, although those are actually under the control of the Director
of the USPHS Commissioned Corps Headquarters. The SG also issues information
to the public (Surgeon General’s advisories, Calls to Action, and Reports), serving
in effect as a key public health spokesperson for the federal government.

USPHS officers are assigned to various agencies such as the CDC, NIH, and
Bureau of Prisons. Their organizational structure is similar in some respects to the
National Guard’s, and their salaries are paid primarily by the agencies to which they
are assigned (which serves to limit USPHS appropriations). USPHS officers can be
deployed on missions to respond to domestic or international crises (for example,
a hurricane in Florida or an Ebola outbreak in Africa) at any time.

The USPHS should be restructured to make it more like its sister uniformed
services with a more streamlined chain of command and corresponding appro-
priations to ensure efficiency and clarity of mission. Its core mission should be
refocused to emphasize prompt, responsive deployments that meet specific criteria
and are less dependent on the various agencies to which the officers are assigned.
Fulfillment of specific tasks should not be duplicated by non-uniformed civil ser-
vants and USPHS officers, and any roles that can be filled by civilians should be
filled by them.

The ASH and SG positions should be combined into one four-star position with
the rank, responsibilities, and authority of the ASH retained but with the title of
Surgeon General and some of the SG’s communications responsibilities, which
would include disseminating other HHS messages and sharing general medical
advice without legal weight. The holder of this consolidated position, which should
be filled by a health care provider, would be better positioned to ensure that the
USPHS is properly focused and deployed.

With such reforms, the supporting office (previously the OASH and OSG) would
be better equipped than other HHS offices or agencies to reduce silos and con-
solidate or eliminate duplicative functions. Congress should consider legislation
that would require this office to take such actions or at least make such recom-
mendations to the Secretary. Such legislation would require a thorough analysis
of the various legal authorities impacting the department’s current organiza-
tional structure.

The position previously known as the Principal Deputy Assistant Secretary for
Health should be combined with and have the title of Deputy Surgeon General
and become a three-star position with operational control including financial and
deployment decisions. The Director of the Headquarters should be responsible for
implementing the decisions of the Deputy Surgeon General.

Promoting Life and Family. In dealing with sexually transmitted diseases and
unwanted pregnancies, the OASH should focus on root-cause analysis with a focus
on strengthening marriage and sexual risk avoidance. Strong leadership is needed

— 490 —

2025 Presidential Transition Project

in the Office of Science and Medicine to drive investigative review of literature fora
variety of issues including the effect of abortion on prematurity and breast cancer;
lack of evidence for so-called gender-affirming care; and physical and emotional
damage following cross-sex treatments, especially on children. The OASH should
withdraw all recommendations of and support for cross-sex medical interventions
and “gender-affirming care.”

Title X. The Title X family planning program should be reframed with a focus
on better education around fertility awareness and holistic family planning and a
Deputy Assistant Secretary for Population Affairs that understands the program
and is able to work within its legislative framework (ideally, an MD). In addition,
the Office of Population Affairs should eliminate religious discrimination in grant
selections and guarantee the right of conscience and religious freedom of health
care workers and participants in the Title X program.

In 2021, HHS reversed a Trump Administration regulation that required grant-
ees to maintain strict physical and financial separation between Title X activity and
abortion-related activity.”° Under the Biden Administration’s regulation,” Title X
activity can be conducted alongside abortion activity without strict physical and
financial separation. The regulation also requires grantees to refer for abortions
despite sincere moral or religious objections. This effectively bans otherwise qual-
ified pro-life grantees from participating in the program.

HHS should rescind the Biden Administration’s regulation and reinstate the
Trump Administration regulation for the program. It should also do this quickly
(the Biden Administration completed its regulatory process and issued a final rule
in less than nine months) and expand the potential grantee population beyond
abortion providers like Planned Parenthood.

Congress should complement these efforts by passing legislation such as the
Title X Abortion Provider Prohibition Act,”* which would prohibit family planning
grants from going to entities that perform abortions or provide funding to other
entities that perform abortions. This would help to protect the integrity of the
Title X program even under an abortion-friendly Administration.

ADMINISTRATION FOR STRATEGIC
PREPAREDNESS AND RESPONSE (ASPR)

ASPR vs. FEMA. When the President declares a national emergency (per the
Stafford Act) related to a public health emergency declared by the HHS Secretary,
FEMA is activated and controls instead of HHS/ASPR. While this arrangement
has some benefits because of FEMA’s unique logistical capabilities, the arrange-
ment should be reviewed—especially considering the COVID-19 pandemic—for
improvements in efficiency according to expertise and available resources, reduced
confusion for ASPR and among HHS agencies, and avoidance of duplicated efforts
among agencies and personnel.

— 491—

Mandate for Leadership: The Conservative Promise

Strategic National Stockpile. The President should invoke the Defense Pro-
duction Act,” which is a form of temporary takeover of private enterprises, only
in the gravest circumstances. The Strategic National Stockpile (SNS) should be
reformed to consider the potential supply chain disruptions of pandemics or global
conflicts. Also, during the COVID pandemic, many states received ventilators from
the SNS and hoarded them in places where a rush of COVID patients needing ven-
tilators never materialized. The SNS should clarify its mission as supplier of last
resort to the federal government, state governments, or first responders and key
medical staff and should not portray itself as serving the public as a whole.

OFFICE OF GENERAL COUNSEL (OGC)

The Office of General Counsel is essential to ensuring that HHS is operating
within the bounds of its numerous governing statutes. However, legal caution can
outweigh practical necessity and often slows processes and decisions when time is
of the essence. Such problems were evident both before and during the COVID-19
pandemic. Internal processes should be reformed to streamline necessary legal
determinations during crises, and general processes should be reviewed for effi-
ciency. OGC should also:

e Rescind its PREP Act liability memo. OGC issued a PREP Acct liability
memo that suspended application of civil rights and other laws in the
context of the administration of covered countermeasures during the
pandemic. It should be rescinded as contrary to law.

e Rescind efforts to curtail OCR authority over conscience and
religious freedom. All OGC memos and Federal Register notices of
organization or delegations of authority moving any OCR conscience
and religious freedom enforcement to OGC, including RFRA, should
be rescinded, and independent authority over these matters should be
restored to OCR.

e Encourage DOJ to repeal OLC memos allowing abortion funding
despite Hyde and memos allowing federal enclave immunity to
perform abortions despite the Assimilative Crimes Act.°°

e Rescind legal analysis that authorized HHS to impose a moratorium
on rental evictions during COVID.

e Rescind the OGC legal analysis saying that the injunction in Bowen

v. American Hospital Association* prevents any proposed HHS
regulations or enforcement actions concerning the denial of care

— 492 —

2025 Presidential Transition Project

to newborn infants with disabilities by covered health care entities
without or against parental consent.

e Rescind the legal analysis supporting the Biden Administration’s
decision to dismiss the University of Vermont Medical Center
case dealing with the forced participation of a nurse in abortion in
violation of law.

e Rescind the legal analysis restoring $200 million in Medicaid funds
to California after having been found to be in violation of the Weldon
Amendment by OCR.

OFFICE OF GLOBAL AFFAIRS (OGA)

The Director of the Office of Global Affairs should have the title of Assistant
Secretary so that he or she can adequately represent HHS and the Secretary and
serve as the lead on global health diplomacy for the government. The designation

“Director” is not understood to indicate the leadership role that this position holds
in the international arena. In addition:

e All divisions that work on international health efforts should be
responsive to requests and direction from the Assistant Secretary
with coordination for all health diplomacy emanating from OGA.

e OGA should have a clear and consistent voice for the Administration’s
pro-life and pro-family priorities in all international engagements.

e OGA should hold oversight authority for implementation of the
Mexico City policy throughout all divisions.

e Every effort should be made to locate all OGA staff in the same
building for better oversight and communication.

e Health attachés in various global locations should be trained in the
Administration’s policies with clear expectations communicated
and with accountability, including replacement, when their
conduct and advocacy are contrary to Administration policies and
programmatic priorities.

OFFICE FOR CIVIL RIGHTS (OCR)

Conscience Enforcement. Existing statutes that protect rights of conscience
(such as the Church, Coats—Snowe, and Weldon amendments) do not explicitly

— 493 —

Mandate for Leadership: The Conservative Promise

provide a private right of action that would allow victims to seek legal redress in
court. At the same time, when it continues to fund governmental and private enti-
ties that violate these laws, HHS is spending taxpayer funds unlawfully. Under
liberal Administrations, OCR has amassed a poor record of devoting resources to
conscience and religious freedom enforcement and is often complicit in approving
or looking the other way at the Administration’s own attacks on religious liberty.
Congress should pass the Conscience Protection Act so that victims can pursue
redress through courts without having to depend exclusively on OCR. In addition:

e OCR should return to Trump Administration policies that initiated
robust enforcement of these conscience laws. It should restore and fully
fund the Office of the Deputy Director for the Conscience and Religious
Freedom Division (CRFD) and ensure that it has the necessary delegations
from the Secretary to enforce these laws. The Secretary should give
adequate delegations to OCR to pursue enforcement of conscience laws,
including RFRA, and require all HHS components that provide funding or
grants to cooperate with OCR CRFD investigations.

The Secretary, the Deputy Secretary, and principals in other HHS divisions
should endorse the remedial measures recommended by OCR CRFD and
limit territorial objections and slow-down attempts by other divisional
officials including OGC. HHS should withdraw funding from any violating
entities that refuse to correct their behavior, and OCR CRFD should work
with ASFR to ensure that all grant announcements and instruments inform
grantees and applicants of their obligations to comply with federal health
care conscience laws specifically as a condition of obtaining or maintaining
their funding.

e Adraft OCR RFRA and religious freedom rule from the Trump
Administration should be issued and finalized. These regulations would
provide a clear process for OCR’s enforcement in coordination with other
HHS divisions and existing HHS grants regulations.

e HHS should reestablish waivers for state and child welfare agencies
for religious exemptions, especially for faith-based adoption and
foster care agencies. It should also rescind subjective case-by-case eval-
uations for religious and faith-based organizations that request religious
exemptions. These case-by-case determinations are currently coordinated
with ACF and OCR. The recommended waivers should be granted to all
states and agencies that request them, and OCR memos finding that RFRA
would be violated if the waivers are not granted should be restored.

— 494 —

2025 Presidential Transition Project

HHS should restore OCR authority to review requests for and
render opinions on the application of RFRA to requests for religious
accommodation of people, families, and doctors who cannot in good
conscience take or administer vaccines, including those made or
tested with aborted fetal cell lines.

HHS should restore Section 1557, Section 504, and other OCR
regulations and fix guidance documents. In 2020, the Trump
Administration’s OCR published regulations under Section 1557 of the
Affordable Care Act that restored the agency’s enforcement of that law

to the limits of its statutory text, deferred to the ACA’s widespread use of

a binary biological conception of sex discrimination, and specified that

the regulation must comply with the religious exemption and abortion
neutrality clauses in Title IX from which it is derived as well as the Religious
Freedom Restoration Act and other laws. Courts blocked core provisions of
that rule from going into effect.

In 2022, the Biden Administration proposed to reinstate a rule
contradicting the scope of the statute and imposing nondiscrimination on
the basis of sexual orientation and gender identity. It is expected that this
rule will be finalized in 2023 even though several courts have issued rulings
against the interpretation on which it is based.

OCR should return its enforcement of sex discrimination
to the statutory framework of Section 1557 and Title IX.
Specifically, it should:

1. Remove all guidance issued under the Biden Administration
concerning sexual orientation and gender identity under Section 1557,
particularly the May 2021 announcement of enforcement*® and March
2022 statement threatening states that protect minors from genital
mutilation.*

2. Issue a general statement of policy specifying that it will not enforce any
prohibition on sexual orientation and gender identity discrimination in
the Section 1557 regulation and that it will prioritize compliance with
the First Amendment, RFRA, and federal conscience laws in any case
implicating those claims. DOJ should commit to defending these actions
aggressively against inevitable court challenges, including under cases
such as Heckler v. Chaney.**

— 495 —

Mandate for Leadership: The Conservative Promise

3. Issue a proposed rule to restore the Trump regulations under Section
1557, explicitly interpreting the law not to include sexual orientation
and gender identity discrimination based on the textual approach to
male and female biology taken by Congress in the ACA, the need to
recognize biological distinctions as part of the sound practice of health
care, and the need to ensure protections of medical judgment and
conscience. DOJ should agree to defend this rule to the Supreme Court
if necessary.

4. Issue a general statement of policy announcing that it plans to enforce
Section 1557 discrimination bans by refocusing on serious cases of
race, sex, and disability discrimination. In particular, OCR should
highlight its 2019 investigation and voluntary resolution agreement
with Michigan State University based on the sexual abuse of gymnasts
by Larry Nassar. OCR should also coordinate with the Department of
Education on a public education and civil rights enforcement campaign
to ensure that female college athletes who become pregnant are no
longer pressured to obtain abortions; pursue race discrimination claims
against entities that adopt or impose racially discriminatory policies
such as those based on critical race theory; and announce its intention
to enforce disability rights laws to protect children born prematurely,
children with disabilities, and children born alive after abortions.

5. Issue and finalize the Trump-era draft disability rights regulations
concerning crisis standards of care and use of Quality of Life
Adjusted Years (QALYs), and reissue and finalize a disability
regulation (withdrawn by the Biden Administration) that prohibited
discriminatory application of assisted suicide and denial of life-saving
treatments for disabled newborns.

OCR should withdraw its pharmacy abortion mandate guidance. OCR
should withdraw its “Obligations Under Federal Civil Rights Laws to Ensure
Access to Comprehensive Reproductive Health Care Services” guidance

for retail pharmacies,*®° which purports to address nondiscrimination
obligations of pharmacies under federal civil rights laws and in fact orders
them to stock and dispense first-trimester abortion drugs. The guidance
invents this so-called requirement and fails to acknowledge that pharmacies
and pharmacists have the right not to participate in abortions, including
pill-induced abortions, if doing so would violate their sincere moral or
religious objections. Moreover, no federal civil rights laws preempt state
pro-life statutes.

— 496 —

2025 Presidential Transition Project

OCR should withdraw its Health Insurance Portability and
Accountability Act (HIPAA)®* guidance on abortion. OCR should
withdraw its June 2022 guidance” that purports to address patient privacy
concerns following the Dobbs decision but is actually a politicized statement
in favor of abortion and against Dobbs. HIPAA covers patients in the womb,
but this guidance treats them as nonpersons contrary to law. The guidance

is unnecessary and contributes to ideologically motivated fearmongering
about abortion after Dobbs.

AUTHOR'S NOTE: The preparation of this chapter was a collective enterprise of selfless individuals involved
in the 2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume
and include former officials in the U.S. Department of Health and Human Services and other agencies, as well as
academics, attorneys, and experts in the health care and insurance fields.

— A97 —

Mandate for Leadership: The Conservative Promise

ENDNOTES

10.

“In the context of HHS, this S

U.S. Department of Health and Human Services, Strategic Plan, FY 2018-2022, p. 50, https://aspe.hhs.gov/

sites/default/files/documents/
(accessed February 7, 2023).

“Strategic Goal 1: Protect and S

rengthen Equitable Access to High Quality an
rategic Plan adopts the definition of underser

ed communities listed in

eac346aca96/bfadc446398679el4ec/hhs-strategic-plan-fy-2018-2022.pdf

d Affordable Healthcare” in ibid.

Executive

“CDC Foundation Act

Order 13985: Advancing Raci

Government to refer

who have been systematica
inition includes |

life’; this de
treatment, such as B

Islanders and other persons
queer (LGBTQ+) persons; pe
fected by persis
and face intersecting barriers. Th
underserved populations throughout this Strategic P
S’ Life Expectancy Continues

adversely a
community

Karen Wein

F02-20220302-SD0
Regulation of Clinica

U.S. Department of
Disease Control and

ovember 6, 2019, h
Febr
and Prevention, “CDC
cdcfoundation.org/si
February 7, 2023);

raub, “American
Century,” USA Today, Decem
expectancy-continues-fall-erasing-25-years-health-gains/109374
Apoorva Mandavilli, “The C.
updated February 22, 2022,

Zachary B. Sluzala and Edm

heritage.org/public-health/
Health and

Judith Garber, “CDC ‘Disclai

al
0 ‘popula

Equity and Support for

lack, La
of

be
D.C.
04.pdf (ac

| Testing,”

Prevention
n

tps://

owni

Foundatio
es/defa

und F. Haislmaier, “Lessons from COV

ners’

ult/
“CDC Active P

viduals who belong to
a
color; members of religi

t poverty or inequality. Individuals
iS definition

an.”

bid. Emphasis in

r 22, 2022, https://www.

Isn't Publishing Large Portions of the Da

cessed March 22, 2023).

D-
Heritage Foundation Backgrounder

eport/lessons-covid-19-how-policymakers-shou

Human Services, Centers for Disease Control

Hide Financial Conflicts of Interest,” Lown Inst
nstitute.org/cdc-disclaimers-hide-financial-con

n Active Programs (October 1, 2014-Septembe

ograms (October 1, 2015-September 30, 2016

Underserved Communities through the Federa

ions sharing a particular characteristic, as we
y denied a full opportunity
ndi
ino, and Indigenous and

ties that have been

itute Accountability B

),” https:/Awww.cdcfo

org/sites/default/files/upload/pdf/CDCFoundation-ActivePrograms-FY2016.pd

sites/default/files/upl
Foundation Active P
files/upload/pdf/CDC
Active Programs, Oc

pdf/CDCFoundation-Ac
, 2029-September 30, 2020,” httos:/Awww.cde

October
(accessed February
ht
Joel Whi

e and

org/sites/default/fi

H.R. 632, Ensuri

ps://www.cdcfounda
Doug Badger, “In Order to Defea

ng Accurate and Complete Abor

undation-ActivePrograms-FY20

COV

ion Acti

Moder

5016, December 9, 2019, https://www.heritage.org/sites/default/files/2019-12/IB5016__1.pdf.

— 498 —

| as geographic commu
0 participate in aspects of economic, social,
underserved communi
ive American persons, Asian Americans and
ous minorities; lesbian, gay, bisexual, transgender, and
rsons with disabilities; persons who live in rural areas; and persons otherwise
may belong to more than one underserved
applies to the terms underserved communities and
original.
0 Fall, Erasing Health Gains of the Last Quarter
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8002/ (accessed February 6, 2023).

a It Collects,” The New York Times,
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nities,
and civic
denied such
Pacific

9: How Policymakers Should Reform the
0. 3696, March 28, 2022, https://www.
d-reform-the-regulation-clinical.
and Prevention, “Centers for
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09,

licts-of-interest/ (accessed
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‘ 30, 2015),” https://www.
iles/upload/pdf/CDCFoundation-ActivePrograms-FY2015.pdf (accessed

rol

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(accessed February 7, 2023);
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ion.org/sites/default/

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s-CDC-FY20?inline
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2021,”

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linical Testing,
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Sluzala and Haislmaier, “Lessons From COVID-19: How Policymakers Should Reform the Regulation of

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8 U.S.C. 1461, httos://www.law.cornell.edu/uscode/text/18/1461 (accessed March 16, 2023), and 18 U.S.C. 1462,
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H.R. 1308, Religious Freedom Restoration Act of 1993, Public Law No. 103-141, 103rd Congress, November 16,
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42 U.S. Code § 256b, https://www.law.cornell.edu/uscode/text/42/256b (accessed March 16, 2023).

H.R. 3590, Patient Protection and Affordable Care Act, § 3022.

H.R. 5376, Inflation Reduction Act of 2022, Public Law No. 117-169, 117th Congress, August 16, 2022, https://
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32.

33.

34,

55:

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Si;

38.

39.

40.

Al.

42.

43.

44.

AS.

46.

47.
48.
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in-

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and

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caid: Need
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H.R. 372, Protect

H.R. 3128, Conso

22, 2023).

ion.

31. Total revenue of $1,714.4 million (p. 30) minus $1,580.7 million in

y enacted in H.R. 2471, Consolidated Appropriations Act, 2022, Public Law No. 117-103, 117th
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ive and Other Healthcare

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16, 2023).

ood, 2020-2021 Annual Report, p. 27, https://www.plannedparenthood.org/uploads/
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total expenses (p. 31)

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idated Omnibus Budget Reconciliation Act of 1985, Public Law No. 99-272, 99th Congress,
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— 500 —

54.

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Discrimination on the Basis of Disability in Cri

arch 17, 2023).
H.R. 26, Born-Alive Aborti
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on Survivors Protec

introduced January 9, 2023, https://www.cong
S. 401, Conscience Protection Act of 2021, 117t
gov/117/bills/s401/BILLS-1
U.S. Department of Health
Secretary, “Nondiscrimina

s/hr26/BILLS-T18hr26pcs.pdf
H.R. 7, No Taxpayer Funding for Abortion and Abortion Insurance

7sAOlis.odf (accessed March
and Human Services, Centers for Medicare and Medicaid Services, and Office of the
ion in Health Programs and Activities,” Notice of Proposed Rulemaking; Notice of

ical Health and H

of Proposed Rule, January 14, 2021, https://www.hhs.gov/sites/default/fi

ion Act, 118th Con

ess.gov/118/bills/h
h Congress, introd

(accessed March

U.S. Department of Health and Human Services, Centers for Medicare and Medicaid Services, Office of Civil
Rights, and Office of the Secretary, “Special Responsibilities of Medicare

Hospitals in Emergency Cases and
uman Service Programs or Activities,” draft
es/infants-nprm.pdf (accessed
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Full Disclosure Act of 2023, 18th Congress,
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Tribal Consultation, Federal Register, Vol. 87, No. 149 (August 4, 2022), pp. 47824-47920, https://www.govinfo.

gov/conten
Ibid., p. 47916

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The regulation was not finalized before the end of the Administration. U.S. Department of Agriculture,

Food and
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ion-assistance-program-snap (accessed March 17, 2023).

al-nutri
Federal Regulations $ 75.300(c) a

supplemen
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subchapter-A/part-75/subpart-D/subject-group-EC

arch 17, 2023).

H.R. 1750, Child Wel
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Provider Inclusion Act of 2021,
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S. 3949, Trafficking Victims Pro
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Kelsey Y. Santamaria, “Child Migrants at the
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Repor'
Repor

See, for example, Alan J. Hawkins, “Are

H.R. 8404, Respect for Marriage Ac
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Commentary, https://ww

Security Admini

utrition Services, “Revision of Categorica
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ection Reauthorization Act of 202
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92f4-d7ledd468ad6/building-a-happy-home.pdf (accessed March 17, 2023). The cover of the report reflects
hat the Social Capital Project is “[a] project of the Joint Economic Committee - Republicans.”

Federally Supported Relationship
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congress.gov/117/plaws/publ228/PLAW-I17publ228,pdf (accessed March
, Public Law No. 117-228, 117
17/plaws/publ228/PLAW-117publ228.pdf (accessed
adison Marino, “Over 1,000 Safety Violations Mar Head Start. Children Deserve Better,’ Heritage Foundation

in the Supplemental Nutrition Assistance
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5670/revision-of-categorical-eligibility-in-the-

w.ecfr.gov/current/title-45/subtitle-A/

TeSela30bfbcb/section-75.300 (accessed

, 117th Congress, introduced March 10, 2021, https://
750/BILLS-117hr1750ih.pdf (accessed March 17, 2023), and S. 656, Child Welfare
117th Congress, introduced March 10, 2021, https://www.congress.gov/117/bills/

2, Public Law No. 117-548, 117th Congress,

Education Programs for Lower-Income Individuals
erprise Institute, September 2019, httos:/www.

7, 2023).

h Congress, December 13, 2022, https://Awww.
March 17, 2023).

w.heritage.org/ed

violations-mar-head-start-children-deserve-better.

American Hospital Association v. Becerra, 596 U.S. (2022), h
opinions/21pdf/20-1114_09m1.pdf (accessed March 17, 2023).
U.S. Department of the Treasury, Internal Revenue Service; U.S. Department of Labor, Employee Benefits
stration; and U.S. Department of Health and Human Services, Centers for Medicare and

ucation/commentary/over-1000-safety-

tps://www.supremecourt.gov/

Medicaid Services, “Coverage of Certain Preventive Services Under the Affordable Care Act,” Notice of
Proposed Rulemaking, Federa/ Register, Vol. 88, No. 22 (February 2, 2023), pp. 7236-7281, https://Awww.
govinfo.gov/content/pkg/FR-2023-02-02/pdf/2023-01981.pdf (accessed March 17, 2023).

— 501 —

71.
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73.

74,

79:

76.

77.

78.

79.
80.
81.

82.

83.

84.

85.

86.

87.

Mandate for Leadership: The Conservative Promise

42 U.S. Code § 238n, https://www.law.cornell.edu/uscode/text/42/238n (accessed March 17, 2023).

U.S. Department of Health and Human Services, Health Resources and Services Admin

istration, “Early

Childhood Health,” last reviewed October 2022, https://mchb.hrsa.gov/programs-impact/focus-areas/early-

childhood-health (accessed
American Pregnancy Associa
org/healthy-pregna

that%20having

(accessed March 17, 2023).
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S. 2372, VA
of 2018, Public
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U.S. Departmen
Timely,” Fina
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42 (March 4, 20.
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ea

men

A omc

<e}

congress.gov/Tl

nt of Hea

arch 18, 2023).

th, “Ensuring Access to Equ
ule, Federal Register, Vol. 86,
g/FR-2021-10-07/pdf/2021-2
S. 624, Title X Abortion Provider Prohibition Act, 118th Congress, introduced March 2, 2023, ht

arch 17, 2023).

%20a%20dou

0. 115-182, 115th
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ecessary Statu
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fice of the Assistan
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fice of the Assistan
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ion, “Having a Doula—What Are the Benefits?” https://american
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a,massage%20to%20reduce%20stress%20and%20anxie

Maintaining Internal Systems and Strengthening Integrated Outside Net
Congress, June 6, 2018, https://Awww.congress.gov/1

ory

Reg

pregnancy.

y%20during%20labor

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5/plaws/publi82/

Evaluations

ps://www.govinfo.

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ister, Vol. 84, No.

/2019-03461.pdf

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ps://www.

50 U.S. Code Chapter 55, https://www.law.cornell.edu/uscode/text/50/chapter-55 (accessed March 22, 2023).

Federal Registe

Affirming Care,

U.S. Departmen

special-topics/r
H.R. 3103, “Hea

U.S. Departmen
Reproductive H

8 US. Code § 13, ht
Bowen v. American Hospital Association, 476 U.S. 610 (198
usrep/usrep476/usrep476610/usrep476610.pdf (accessed 22, 2023).
U.S. Department of
Enforcement of Sec

2021-05-25/pdf/2021-10477.pdf
U.S. Department of

Pharmacies: Ob
Health Care Services,” content last rev

Congress, August 2
arch 18, 2023).

ps://www.law.cornell.edu/uscode/text/18/13 (accessed

hand Human
557 of the Af
No. 99

Heal
ion
r, Vol. 86,

Services, Office of

accessed March 18, 2023).
Health and Human Services, Office
Rights, and Patient Privacy,’ March

Civi

985), https://caselaw.findlaw.com/|

Heal
ions

of
iga

h and Human Services, Office
Under Federal Civil Rights Laws to
iewed July 14, 2022, h

eproductive-hea
h Insurance and Portabili

y and Accountability Act of 1996,

of
ealth Care,” content last reviewed June 29, 2022, (accessed

“Protecting the Privacy and Security of Your Health Information When Using

Tablet,” conten

cell-phone-hipaa/index.html (accessed March 18, 2023).

— 502 —

6), https://tile.loc.g

he Secretary, “Noti
ordable Care Act and Title IX of the Ed
(May 25, 2021), pp. 27984-27985, https://www.govinfo.gov/content/pkg/FR-

or Civil Rights, “HHS
2, 2022, https://www.hhs.gov/sites/de
ocr-notice-and-guidance-gender-affirming-care.pdf (accessed March 18, 2023).
Heckler v. Chaney, 420 U.S. 821 (
arch 18, 2022).

s-Supren

or Civil Rights, “Guidance to Na
Ensure Access to Comprehensive Reproductive
tos://www.hhs.gov/civil-rights/fo
thcare/pharmacies-guidance/index.html (accessed Ma

Human Services, “HIPAA Privacy Rule and Disclosures 0

arch 18, 2023).

ch 18,

Public Law

Information Rela

Your Personal Cel

last reviewed June 29, 2022, https://www.hhs.gov/hipaa/fo

ion’s Reta

ov/storage-services/service/II/

fication of Interpretation and
ucation Amendments of 1972,”

otice and Guidance on Gender

fault/files/hhs-

ne-court/470/821.html (accessed

-individuals/
2023).

0. 104-191, 104th
, 1996, https://www.congress.gov/104/plaws/publ191/PLAW-104publ191.odf (accessed

ing to

arch 18, 2023). See also

Phone or

-professionals/privacy/guidance/

DEPARTMENT OF HOUSING
AND URBAN DEVELOPMENT

Benjamin S. Carson, Sr., MD

he U.S. Department of Housing and Urban Development (HUD) admin-

isters a web of federal programs with mandates to support access to

homeownership and affordable rental housing, relieve temporary hous-
ing instability for homeless persons, preserve a stable inventory of public housing
units, and enforce mandates with powers to settle compliance matters ranging
from housing quality standards to housing discrimination cases.

Politicians across party lines use HUD to promise ever-greater public bene-
fits. In addition, HUD programs tend to perpetuate the notion of bureaucratically
provided housing as a basic life need and, whether intentionally or not, fail to
acknowledge that these public benefits too often have led to intergenerational
poverty traps, have implicitly penalized family formation in traditional two-parent
marriages, and have discouraged work and income growth, thereby limiting upward
mobility. A new conservative Administration will therefore need to:

e Reset HUD. This effort should specifically include a broad reversal of the
Biden Administration’s persistent implementation of corrosive progressive
ideologies across the department’s programs.

e Implement an action plan across both process and people. This plan
should include both the immediate redelegation of authority to a cadre
of political appointees and the urgent implementation of administrative
regulatory actions with respect to HUD policy and program eligibility.

— 503 —

Mandate for Leadership: The Conservative Promise

e Reverse HUD’s mission creep over nearly a century of program
implementation dating from the Department’s New Deal forebears.
HUD’s new political leadership team will need to reexamine the federal
government’s role in housing markets across the nation and consider
whether it is time for a “reform, reinvention, and renewal” that transfers
Department functions to separate federal agencies, states, and localities.

OVERVIEW

HUD was created by the Housing and Urban Development Act of 1965? and
since then has administered several programs that had been administered by
the Housing and Home Finance Agency. With a proposed fiscal year (FY) budget
authority totaling $71.9 billion and 8,326 full-time equivalent (FTE) employees,*
it remains the largest government agency charged with implementing federal
housing policy.

In addition to its headquarters in Washington, D.C., HUD has 10 regional
offices as well as field offices and centers to implement specialized operational
and enforcement responsibilities.* HUD program offices also interface with various
networks of implementing organizations such as locally chartered public housing
agencies (PHAs) and federal, state, and local government and judicial bodies as
well as such private industry participants as mortgage lenders.

The Secretary of Housing and Urban Development can delegate authority to
various entities across an array of HUD programs.° The Secretary also oversees
the Office of the Deputy Secretary;° the Office of Hearings and Appeals (OHA);’
the Office of Small and Disadvantaged Business Utilization (OSDBU);° and the
Center for Faith-Based and Neighborhood Partnerships (CFBNP).? The Office of
the Secretary also comprises a team of politically appointed positions and career
support staff. Each of the following offices should be headed by political appointees
except where otherwise noted.

e Office of Administration, headed by the Chief Administration Officer.
The Office of Administration has responsibilities for the Office of the Chief
Human Capital Officer (OCHO, headed by the Chief Human Capital Officer,
currently a career position) and the Office of the Chief Procurement Officer
(CPO, headed by the Chief Procurement Officer, currently a career position).

e Office of the Chief Financial Officer, headed by the Chief
Financial Officer.

e Office of the Chief Information Officer, headed by the Chief
Information Officer.

— 504 —

2025 Presidential Transition Project

Office of Public Affairs, headed by a Senate-confirmed Assistant Secretary
(AS) or Principal Deputy Assistant Secretary (PDAS).

Office of Congressional and Intergovernmental Relations (CIR),
headed by a Senate-confirmed AS or PDAS.

Office of Community Planning and Development (CPD), headed

by a Senate-confirmed AS or Principal DAS. CPD administers various
entitlement and non-entitlement programs across community
development, disaster recovery, and housing for the homeless’° and
individuals with special needs, including Housing Opportunities for Persons
with AIDS (HOPWA). The two largest CPD-administered programs are

the Community Development Block Grant (CDBG) Program," which
includes disaster recovery funding, and the Home Investment Partnerships
Program (HOME).” CPD’s Relocation and Real Estate Division (RRED) has
departmental delegated authority for the Uniform Relocation Assistance
and Real Property Acquisition Policies Act of 1970.%

Office of Public and Indian Housing (PIH), headed by a Senate-
confirmed AS or PDAS. PIH administers public housing and tenant-based
rental assistance programs, as well as authorities for Native American and
Native Hawaiian housing assistance and loan guarantee programs under
the Native American Housing Assistance and Self-Determination Act
(NAHSDA)." Tenant-Based Rental Assistance represents the major portion
of HUD’s nonemergency discretionary budget. HUD describes its Housing
Choice Voucher Program as “an essential component of the Federal housing
safety net for people in need.” PIH also implements funding for the Self-
Sufficiency Coordinator Program; the Public Housing Fund (operating

and capital funds for PHA administration of Section 9 public housing and
Section 8 voucher programs); and Choice Neighborhoods (zeroed out during
the Trump Administration budget request but included in HUD’s FY 2023
budget, which requests $250 million for the program)."®

Office of Housing and Federal Housing Administration (FHA),

headed by a dual-hatted, Senate-confirmed AS and Federal Housing
Commissioner or Acting Federal Housing Commissioner. The Office of
Housing oversees implementation of the department’s project-based rental
assistance (PBRA) multifamily housing portfolio, Section 202 supportive
housing for the elderly program, Section 811 program for disabled persons’
housing, and Housing Counseling Assistance program. The Federal
Housing Administration administers the Mutual Mortgage Insurance

— 505 —

Mandate for Leadership: The Conservative Promise

Program (MMIF) and various other mortgage insurance, direct loan, and
loan guarantee programs for single-family housing, multifamily housing,
hospitals, and health care facilities that meet certain conditions.”

Government National Mortgage Association (GNMA), headed by a Sen-
ate-confirmed GNMA President or Executive Vice President. GNMA oversees
more than $2 billion in federal guarantees to mortgage-backed securities
structured from mortgages that are pooled from various federal programs,
including mortgages backed by programs outside of HUD, principally the sin-
gle-family mortgage guarantee programs administered by the Department of
Veterans Affairs (VA) and the Rural Housing Service at the U.S. Department of
Agriculture (USDA). FHA-insured single-family housing mortgages comprise
the largest share of GNMA-guaranteed mortgage-backed securities.

Office of Departmental Equal Employment Opportunity, headed
by a Director.

Office of Fair Housing and Equal Opportunity (FHEO), headed bya
Senate-confirmed AS or PDAS. The Assistant Secretary for FHEO is the
designated HUD official responsible for enforcing Title VI of the Civil
Rights Act of 1964,'8 Section 504 of the Rehabilitation Act of 1973," and
Section 109 of the Housing and Community Development Act of 1974. After
informal efforts to resolve noncompliance, the AS for FHEO may make a
formal finding of noncompliance and initiate enforcement action before an
administrative tribunal or a referral to the Department of Justice.

Office of General Counsel (OGC), headed by the General Counsel or
Principal Deputy General Counsel. OGC handles department-wide legal

and compliance oversight advice with supervision responsibilities for the
Deputy General Counsel for Housing Programs, Deputy General Counsel for
Operations, and Deputy General Counsel for Enforcement and Fair Housing
as well as the Departmental Enforcement Center.”

Office of Healthy Homes and Lead Hazard Control (QHHLHC), headed
by a Director. OHHLHC was established in the early 1990s to eliminate
lead-based paint hazards in America’s privately owned and low-income
housing, address healthy housing initiatives, and enforce lead-based paint
regulations authorized under the Residential Lead-Based Paint Hazard
Reduction Act of 1992 (Title X of the Housing and Community Development
Act of 1992).7! These functions overlap with similar functions of the
Environmental Protection Agency (also authorized to enforce lead-based

— 506 —

2025 Presidential Transition Project

paint regulations under Title X) and the Centers for Disease Control
and Prevention’s Healthy Homes Initiative, Childhood Lead Poisoning
Prevention Program, and National Asthma Control Program.

Office of Policy Development and Research (PDR), headed by a Senate-
confirmed AS or PDAS. PDR was established in the early 1970s and today
administers research activities, including external contract research grants,
and provides analytical and policy advice to senior HUD staff. PDR also
provides publicly available statistics through the American Housing Survey
(AHS), which is sponsored by HUD and conducted by the Census Bureau;
the State of the Cities Data Systems; data on the Low-Income Housing Tax
Credit (LIHTC); and annual Fair Market Rents and Income Limits data,
among other statistical publications and datasets on the characteristics of
families assisted under HUD programs.

Office of Inspector General (OIG), headed by an Inspector General.
The OIG is independent of HUD and one of 12 Inspectors General across

the federal government authorized under the Inspector General Act of
1978.”? Operating under its own budget authority and strategic plan, the
HUD OIG conducts internal and external audits and investigations of HUD
programs and operations. While independent of HUD and holding no
enforcement powers over HUD programs, HUD OIG works closely with the
Office of General Counsel, the Departmental Enforcement Center, and HUD
program offices. The Inspector General serves as an adviser to and non-
voting member of the FHA Mortgagee Review Board.

Office of Field Policy and Management (FPM), headed by an Assistant
Deputy Secretary for FPM. FPM supports the Secretary through regional
and field office communication and external engagement with various
community stakeholders to ensure the successful implementation of
Secretarial initiatives and special projects.

HUD REFORM PILLARS

Ideally, Congress would redelegate authorities that have been diverted to HUD’s

administrative bureaucracy and safeguard taxpayers against the mission creep that

inevitably occurs when Congress delegates power to an empowered and unelected

bureaucracy that is insulated by civil service protections. If implemented, the

reforms proposed in this chapter can help a new conservative Administration to

use its Article II powers to rectify bureaucratic overreach, reverse the expansion

of programs beyond their statutory authority, and end progressive policies that

have been put in place at the department.

— 507 —

Mandate for Leadership: The Conservative Promise

It is hoped that a future Congress under conservative leadership will enact legis-
lative reforms of HUD programs. With or without congressional action, however, it
is vital that a conservative Administration immediately institute guardrails across
HUD programs to remove the administrative state’s bureaucratic overreach of
Article I authorities, thereby ensuring formal execution of Article II process and
personnel reforms of the sort outlined below.

FIRST-DAY AND FIRST-YEAR ADMINISTRATIVE REFORMS”

A new conservative Administration can and should implement the follow-
ing reforms that focus on both people” and process.”° Implementation of these
reforms simply requires courageous political leadership across all of HUD’s key
appointed positions.

e HUD political leadership should immediately assign all delegated powers
to politically appointed PDAS, DAS, and other office leadership positions;
change any current career leadership positions into political and non-career
appointment positions; and use Senior Executive Service (SES) transfers to
install motivated and aligned leadership.

e The President should issue an executive order making the HUD Secretary
a member of the Committee on Foreign Investment in the U.S., which will
gain broader oversight authorities to address foreign threats, particularly
from China with oversight of foreign ownership of real estate in both rental
and ownership markets of single-family and multifamily housing,”® with
trillions worth of real estate secured across HUD’s portfolio.

e The Secretary should initiate a HUD task force consisting of politically
appointed personnel to identify and reverse all actions taken by the Biden
Administration to advance progressive ideology.””

e The Office of the Secretary or the leadership in the Office of General
Counsel should conduct a thorough review of all subregulatory guidance
that has been instituted outside of the Administrative Procedure Act (APA).
Additionally, departmental leadership should:

1. Immediately end the Biden Administration’s Property Appraisal and
Valuation Equity (PAVE) policies and reverse any Biden Administration

actions that threaten to undermine the integrity of real estate appraisals.”

2. Repeal climate change initiatives and spending in the department’s
budget request.”

— 508 —

2025 Presidential Transition Project

3. Repeal the Affirmatively Furthering Fair Housing (AFFH) regulation
reinstituted under the Biden Administration” and any other uses of
special-purpose credit authorities to further equity.*

4. Eliminate the new Housing Supply Fund.”

The Office of the Secretary should recommence proposed regulation put
forward under the Trump Administration that would prohibit noncitizens,
including all mixed-status families, from living in all federally assisted
housing.** HUD’s statutory obligations include providing housing for
American citizens who are in need. HUD reforms must also ensure
alignment with reforms implemented by other federal agencies where
immigration status impacts public programs, certainly to include any
reforms in the Public Charge regulatory framework administered by the U.S.
Department of Homeland Security (DHS). Local welfare organizations, not
the federal government, should step up to provide welfare for the housing of
noncitizens.

The Office of the Secretary should execute regulatory and subregulatory
guidance actions, across HUD programs and applicable to all relevant
stakeholders, that would restrict program eligibility when admission
would threaten the protection of the life and health of individuals and
fail to encourage upward mobility and economic advancement through
household self-sufficiency. Where admissible in regulatory action, HUD
should implement reforms reducing the implicit anti-marriage bias in
housing assistance programs,” strengthen work and work-readiness
requirements,” implement maximum term limits for residents in PBRA
and TBRA programs,” and end Housing First*’ policies so that the
department prioritizes mental health and substance abuse issues before
jumping to permanent interventions in homelessness.** Notwithstanding
administrative reforms, Congress should enact legislation that protects
life and eliminates provisions in federal housing and welfare benefits
policies that discourage work, marriage, and meaningful paths to upward
economic mobility.

The AS or PDAS for the Office of Policy Development and Research should
suspend all external research and evaluation grants in the Office of Policy
Development and Research and end or realign to another office any
functions that are not involved in the collection and use of data and survey
administration functions and do not facilitate the execution of regulatory
impact analysis studies.

— 509 —

Mandate for Leadership: The Conservative Promise

FHA leadership should increase the mortgage insurance premium (MIP) for
all products above 20-year terms and maintain MIP for all products below
20-year terms and all refinances. FHA should encourage wealth-building
homeownership opportunities, which can be accomplished best through
shorter-duration mortgages.* Ideally, Congress would contemplate a
fundamental revision of FHA’s statutory restriction of single-family housing
mortgage insurance to first-time homebuyers.*° This would include (with
support from HUD leadership):

1. Moving the Home Equity Conversion Mortgages (HECM) program once
again to its own special risk insurance fund.

2. Revising loan limit determinations.

3. Providing statutory flexibility for shorter-term products that amortize
principal earlier and faster.

Statutorily restricting eligibility for first-time homebuyers and abandoning
the affirmative obligation authorities erected for the single-family housing
programs across federal agencies and government-sponsored enterprises.”

The HUD Secretary should move the HUD Real Estate Assessment Center
(REAC) from PIH to the Office of Housing, which already implements
property standards in its multifamily housing lending programs through
the multifamily accelerated processing (MAP) lending guidelines. Giving
HUD the authority to streamline the enforcement of compliance with
housing standards across the federal government and flexibility for physical
inspections through private accreditation should also be considered.

HUD should maintain its requested budget authority for modernization
initiatives that are applicable to the Office of the Chief Information Officer
and program offices across the department.

LONGER-TERM POLICY REFORM CONSIDERATIONS”

Congress has charged HUD principally with mandates for construction of the

nation’s affordable housing stock in addition to setting and enforcing standards
for decent housing and fair housing enforcement. Regardless of intent, HUD’s
efforts have yielded mixed results at best. Even today, more than a half-century
after Congress put enforcement of so-called fair housing in the hands of the HUD
bureaucracy, implementation of this policy is muddled by the repeated applica-
tion of affirmative race-based policies. Also, the production mandate for HUD’s

— 510 —

2025 Presidential Transition Project

housing portfolio has waned for decades with the department effectively working
to maintain the public housing portfolio from the late 1990s when the Faircloth
Amendment capped HUD’s public housing portfolio.”

Longer-term reforms of HUD rental assistance programs should encourage
choice and competition for renters, encourage participation by landlords where
appropriate,** and encourage all non-elderly, able-bodied adults to move toward
self-sufficiency. This can be pursued through regulations and legislative reforms
that seek to strengthen work requirements, limit the period during which house-
holds are eligible for housing benefits, and add flexibility to rent payment terms
to facilitate the movement of households toward self-sufficiency.

Obviously, using government vouchers or other such programs to expand hous-
ing choice options is not without its downsides. The turn toward mobility vouchers
constitutes an abandonment of America’s public housing stock, and efforts to
increase competition in the public housing market must not come at the expense
of local autonomy and the ability of cities, towns, neighborhoods, and commu-
nities to choose for themselves the sort of housing they want to allow. Freedom
of association and self-government at the most local level possible must remain
primary considerations in any conservative effort to increase competition in the
public housing market.

Congress should also consider those areas in which federal policy negatively
interacts with private markets, including when federal policy crowds out pri-
vate-sector development and exacerbates affordability challenges that persist
across the nation. It is essential that legislation provides states and localities max-
imal flexibility to pursue locally designed policies and minimize the likelihood of
federal preemption of local land use and zoning decisions.

In the same manner, Congress should prioritize any and all legislative support
for the single-family home. Homeownership forms the backbone of the American
Dream. The purchase of a home is the largest investment most Americans will
make in their lifetimes, and homeownership remains the most accessible way to
build generational wealth for millions of Americans. For these reasons, American
homeowners and citizens know best what is in the interest of their neighborhoods
and communities. Localities rather than the federal government must have the
final say in zoning laws and regulations, and a conservative Administration should
oppose any efforts to weaken single-family zoning. Along the same lines, Congress
can propose tax credits for the renovation or repair of housing stock in rural areas
so that more Americans are able to access the American Dream of homeownership.

Additionally, enhanced statutory authorities for local autonomy should extend
to the prioritizing of federal rental assistance subsidies that emphasize choice and
mobility in housing voucher subsidies over static, site-based subsidies and provide
authority for maximal flexibility to direct PHA land sales that involve the existing
stock of public housing units. Congress must consider the future of the public

—5ln-

Mandate for Leadership: The Conservative Promise

housing model. At best, any new public investments will provide maintenance
funds to bring substandard housing units and properties up to livability standards
but will still fail to address larger aims of upward mobility and dynamism for local
housing markets where land can be sold by PHAs and put to greater economic
use, thereby benefiting entire local economies through greater private investment,
productivity and employment opportunities, and increased tax revenue.

Any long-term view of HUD’s future must include maintaining the strong
financial operations and reliable reporting that are needed to run a $50 billion-
per-year agency. Before the Trump Administration, HUD effectively did not have
a Chief Financial Officer (CFO) for eight years, and HUD’s financial infrastructure
inevitably deteriorated. The department’s auditors were unable to conclude that
HUD’s internal operations were producing accurate financial reporting. The audi-
tors had identified multiple material weaknesses and significant deficiencies in
the department’s internal financial controls. Overall, the deterioration of HUD’s
financial infrastructure led to a lack of accountability with respect to the use of
taxpayer funds as well as to pervasive difficulties with operations and program
implementation.

However, by hiring anew CFO from the private sector with a proven track record
of visionary leadership, HUD was able to implement an agencywide governance
structure that improved its financial processes and internal controls and harnessed
the power of innovative new technologies to bring a modernized business mindset
to the agency’s financial infrastructure. By the end of the Trump Administration,
for the first time in nearly a decade, HUD was able to address all of its previously
identified material weaknesses, and the auditors were able to issue their first clean
audit report on HUD’s financial statements and internal controls.

Finally, and more fundamentally, Congress could consider a wholesale overhaul
of HUD that contemplates devolving many HUD functions to states and localities
with any remaining federal functions consolidated to other federal agencies (for
example, by transferring loan guarantee programs to SBA; moving Indian housing
programs to the Department of the Interior; moving rental assistance, mortgage
insurance programs, and GNMA to a redesignated Housing and Home Finance
Agency). Generally, this reform path could consolidate some programs, elimi-
nate others that have failed to produce meaningful long-run results, and narrow
the scope of many programs so that they are closer to what they were when they
were created.

— 512 —

ENDNOTES

2025 Presidential Transition Project

Ata 1998 Senate hearing, then-HUD Secretary Andrew Cuomo acknowledged that the department “faced a
competence gap” and had “the dubious distinction of being the only federal agency designated as ‘high risk’

by the General Accountin
8 rental subsidy as “on th

g [now Government Accountabi
e brink of becoming the next savings and loan scandal,” and explained how the

ity] Office (GAO),” even referencing the Section

department was stepping up enforcement efforts “focused on closing the competence gap by eliminating

waste, fraud, and abuse.”
Subcommittee on VA, HU

H.R. 7984, Housing

oncompetit

For example,
‘5 ;

annual contri

Effectively th
The Office o

he Office o

S a division 0

The Secretary has d
he Assistant Secre
assignment an

Secretary. Led by a

support staff. The H

S. Department of

bution

e HUD
Hearin

Appea

See “Testimony of Secretary Andrew Cuomo before the House Appropriations
D, and Independent Agencies,” March 25, 1998, https://archives.hud.gov/
testimony/1998/tst32598.cfm (accessed March 4, 2023).

and Urban Development Act of 1965, Public Law No. 89-117, 89th Congress, August 10,
1965, https://www.congress.gov/89/statute/STATUTE-79/STATUTE-79-Pg451.pdf (accessed March 4, 2023).

Housing and Urban

elegated full authori

Ss contract (ACC) in public hou

Development, 2023 Budget in Brief, pp. 2 and 7, httos://www.hud.gov/

ites/dfiles/CFO/documents/2023_ BudgetIinBriefFINAL.pdf (accessed March 4, 2023).

the Special Applications Center (SAC) located in Chicago, Illinois, was established in 1998
he Office of Public and
ive applications and plans

ndian Housing to accept, review, and approve all nonfunded,
or demolition, disposition, and conversion of land subject to an
sing.

ty for the Administration and enforcement of the Fair Housing Act to

ary of the Office of Fair Housing and Equal Opportunity but also has delegated limited
d decision-making autho
Chief Operating Officer and appointed by the President with Senate advice and consent.

rity to the General Counsel.

gs and Appeals (OH

Director who is appointed by the Secretary, it supervises the Administrative Judges o
s, the administrative law judges of the Office of Administrative Law Judges, and the OHA
UD Secretary appoints administrative judges and administrative law judges in accordance
with the Administrative Procedure Act, 5 U.S.C. Chapter 5, https://www.law.cornell.edu/uscode/text/5/part-I/
chapter-5 (accessed March 4, 2023).
HUD currently has a Departmental Equi
he OSDBU, “as part of the President’s Executive Order 13985, Executive Order On Advancing Racial Equity
and Support for Underserved Communities Through the Federal Government.” See U.S. Department of
Housing and Urban Development, 2023
dfiles/CFO/documents/2023HUDCongressionalJustificationsFINALelectronicversion.pdf (accessed March 4,
2023), and President Joseph R. Biden Jr., Executive Order 13985, “Advancing Racial Equity and Support for
Underserved Communities Through the Federal Government,” January 20, 2021, in Federa/ Register, Vol. 86,
0. 14 January 25, 2021), pp. 7009-7013, https://www.govinfo.gov/content/pkg/FR-2021-01-25/pdf/2021-
01753.pdf (accessed March 4, 2023).
nterestingly, “[t]he 2023 President’s Bu
han the 2022 Annualized CR level. The
million, $448 thousand
2023 Congressional Justifications, p. 35-16.

A) is an independent adjudicatory office within the Office of the

y Assessment Working Group, supported with five FTEs funded by

Congressional Justifications, p. 35-15, https://www.hud.gov/sites/

dget requests $748 thousand for CFBNP. which is $436 thousand less
Budget reflects total funding (carryover and new authority) of $1.2

ess than 2022 total funding.” U.S. Department of Housing and Urban Development,

See H.R. 558, Stewart B. McKinney Homeless Assistance Act, Public Law No. 100-77, 100th Congress, July 22,

1987, https://(www.govin

Established u

www.law.corne|

S. 566, Crans

edu/u

o.gov/content/pkg/STATUTE-101/pdf/STATUTE-101-Pg482.pdf (accessed March 5,
2023). Later renamed the McKinney-Vento Homeless Assistance Act.
nder the Housing and Community Development Act of 1974, 42 U.S.C. §§ 5301 et seq., https://
scode/text/42 (accessed March 4, 2023).
on-Gonzalez National Affordable Housing Act, Public Law No. 101-625, 101st Congress,

November 28, 1990, Title Il, https:/Avww.congress.gov/101/statute/STATUTE-104/STATUTE-104-Pg4079. pdf
(accessed March 5, 2023).

S. 1, Uniform

Ist Congress, January

Relocation Assistance and
2, 1971, https://www.congress.gov/91/statute/STATUTE-84/STATUTE-84-Pg1894.pdf

Real Property Acquisition Policies Act of 1970, Public Law No. 91-646,

(accessed March 4, 2023). “The URA establishes the minimum Federal requirements for the acquisition of real

property for Federally-

unded programs and projects, and for the relocation of persons who must move from

— 513 —

14.

15.

16.
1}.

18.
19.
20.

21.

22.

23.

24.

hei

Par
real
LI ig
694

R
04

S
ou
ha

Cen

cong
Guidi
high
admi
elimi
Who
politi
Othe

departme

84, ht
. 3219,
h Con

24-U

hway Administration, “

Mandate for Leadership: The Conservative Promise

ps://www.govin
Native American

A decade later, the Housing
D and federal legislators
a national policy objective the provision o
islation also statutorily establish
ng the
/uscode/text/42 (accessed

expanded prog
www.law.corne
U.S. Departm
The National Housing Act
main stated premise was
Depression. 42

General Coun
Division an
managemen
and Urban
ter,” ht
R. 5334,

ress.g

nistra

nated and/or
ly aside
cal appoi

wise,

align

ment

ng qu
proba

ent of Housin
of 1937
er federal fun
icy that expanded th

ent of eradicati

Housing Ass
gress, October 26, 1996, https
(accessed March 4, 2023).
.Departm
sing Act
adminis
Deal-era pol
islative in
working poor. 42 U.S.C. 88 1437 e

g and Urban
(Wagner-Steaga
ding for various ren

ng slumh

| Act) es

e adm
0
Seq.,

using in urban

Act o

ams facilitati
led

t of Housi

en ng

et seq., h

mental Enforcemen

sel. The DEC “is com
ive Satellite Offices”
and accountability
Development, Departn
ps://www.hud.gov/pro

have cont

934 es
0 stimula
U.S.C. §§ 1701 et seq., h
42 U.S.C. §§ 2000d et seq., https://www.law.cornell.ed
29 U.S.C. 8§ 70
HUD’s Depar
oader effor

ttos://www.
Center (DEC) is led by a Director. It was es
to streamline and consolidate functions

codified federa
ued to use to j
a mini
many of the ru
moval of slum h
arch

949
in

ed
re

a
0
4

ablished the FHA an
e jobs and facilitate
ttos://www.

prised of the Office of

e resolution of
al Enforcemen

nen

Housing and Communi

arch 4, 2023).
nspector General Ac
ov/95/statute/STATU
eS
bility of success? Wh
ive reforms, would
realigned to
rom reforms th
ntees are able
whether because
with reforms, staff

a
(e)
)
n

to execute substantive administra

chap

er, political appointees m

ust

of 1978, Public Law
TE-92/STAT!
ions: What immediate admin

achieve the H
educe any
would requi
acquit themse
a sheer lack
nay frustrate

UTE-92-Pgll

short-term
U
edundancy t

egisla

0)
n

e efforts 0

tive refor
be carefu

ly placed in

industry, and operational expertise, but also a shared wi

usti

and describes its mission as
in th
Cen
gram_offices/enforcement (accessed March 4, 2023).
y Development Act of 1992,
October 28, 1992, Title X, https://www.congress.gov/
(accessed
R. 8588,

02/s

istrative reform
D vision/m
legislation
ves as cha

skill and expertise

ms. To achieve the

, 2023).

and Urban Development, 2023 Congressional Justifications, pp. 1-2
he statutory authority for the seconda
he housing and constr
aw.cornell.edu/uscode/text/
u/uscode/text/42 (accessed March 4, 2023).
aw.cornell.edu/uscode/text/29 (accessed
ab

HU
e Di

a
th

er, “Program Offices:

atu

Ol.pd

ission object

_ the next Ad

commit

positions tha
| and commi

ment.

— 514 -

ector, the Compli
“assuring the hig
HUD's troubled properties.”

y progress

g housing

ng—establ
| American
inistered a

arch 4, 2023).

reflect not o

Departmental Enfo

Public Law No. 102-1017, 102nd Cong
e/STATUTE-106/STATUTE-106-Pg3672.pdf

0. 95-452, 95th Congress, October 12, 1978, h
(accessed March 4, 2023).

D and its programs can be made with
ive reforms can be proposed th
ive? What HUD
hat may persist in program
ministration m
nge agents to execute admi
or simply a lack o
ed political appointee s
policy and regulatory reforms outlined in this
echnical, market/

at, in
offices should
ma
ust ensure that
nistrative refor
will a

nly

r homes, businesses, or farms as a direct result of acquisition, rehabilitation, or demolition for a Federally-
unded program or project.” U.S. Department of Housing and Urban Development, HUD Exchange, “49 CFR
RA Regulations,” published February 2005, https://www.hudexchange.info/resource/804/ura-and-
-property-acquisition-policies-act-49-cfr-part-24/ (accessed March 4, 2023). HUD is one of the 18 federal
nts and agencies that “are subject to the Uniform Act.” U.S. Department of Transportation, Federal
Uniform Relocation Assistance and Real Property Acquisition for Federal and
Federally Assisted Programs,” Federal Register, Vol. 84, No. 243 (December 18, 2019), pp. 69466-69521, esp. p.
o.gov/content/pkg/FR-2019-12-18/pdf/2019-25558.pdf (accessed March 4, 2023).
istance and Self-Determination Act of 1996, Public Law No. 104-330,
:/www.congress.gov/104/plaws/pubI330/PLAW-104publ330.pdf

Development, 2023 Congressional Justifications, p. 6-1. The U.S.

ablished the origins of locally chartered housing agencies
al assistance programs—a quintessential i
nistrative state’s powers to the housing market—with t
areas, boosting jobs, and providin
ps://www.law.cornell.edu/uscode/text/42 (accessed

standards for housing livability—a ratio
y federal intervention in housi
mum standard of housing quality for a
housing programs that are adm
ing in urban areas. 42 U.S.C. §§ 1441 e

ve New

he primary

or the

arch 4, 2023).
nale

hat
ishing as

s. This
USDA and

seq., https://

and 2-2.

y market. The
ion sector during the Great

2 (accessed March 4, 2023).

lished in 1998 as part of
D and was later merged with the Office of
ance Division, the Operations
hest standards of e

hics,

U.S. Department of Housing

cement

eSS,

tos://www.

andem with

ic functions?

key
ms.

nd philosophical
aff and leadership

25:

26.

27.

28.

29.

30.

$1;

32.

55:

34,

35.

36.

Process must prioritize where politica

ac
Ch

ion and subregulato
ina and other foreign
ificially drivin
out of the market by such
These |

n
(CRT); black, indi
d governance (ESG).
imum, these ef
itute
ce arbitrary biases
regula

introdu
Revise

iden Administration

U.S. Department of H

s://www.govin
. Department o
Housing,” Proposed R

govinfo.gov/content/pkg/FR-20
Certain pilot initiatives may encourage
g loans with
erator Loan (HEAL) a
wealth genera
ey do no
ng supply does remain a problem in
em. Inves

accumulation, includin
FHA’s Home Equity Acce
ead to meaningfu
households only when th
Housi
will not solve the prob
or greater upward mobili
of mid-tier ren
he U
deve

opmen

housing market.

Deve
(May 10, 2019), pp. 20589
(accessed March 5, 2023).
Reforms should contemp
limits t
assistance and
Some PHAs have been ab
authorized demonstration
in 1996 for 39 PHAs (Cong

g up prices and reducing af
icipation.
itiatives are maintained under such
genous,

orts dup
arbitrary procedures in real es

ory and subregula
necessary delay and costs to t
account for about 40 percent of new housing unit costs in n
ued a proposed rule to rep
munity and Neighborhood Choice” rule that had repea
and Urban Development, Office of
Rule, Federal Register, Vo

eighborhood Choice,” Fina
/2020-

o.gov/conten
Housing and Urban Development, Office of the Secre
ule, Federal Register, Vol. 88, No. 27

U.S. Department of Housing and U
opment Act of 1980: Verifica

2025 Presidential Transition Project

guidance reforms.

market par

Pacific Islan

has iss

ousing

/okg/FR-202

5-07-

ion

ors and devel
ty of ren

ore

ate rent payment flexibili
hat can reduce implicit pena
eweight waiting-lis

ties for inc

e to implement work
programs, notably th
ress has since authori

assistance programs along with flexibilities in th

The FSS program
at the term limi

transitions to fami

has a general five-year term
for overall benefits, and certain
Families in these programs build escrow savings during their term eligibi

he U

al and owne
al units. Further, and m
S., localities can consider revising land use, zoning, and building regulations th
, adding time delays and costs tha
of the way where possible and minimize the dis
ending can have in driving up housing prices for h

prioritizati

nations should not be able to disrupt our nation’s housi
ordability and access to housing for Americans who are crowded

designations as diversi

icate what the federal government a
ate appraisal practices
into what should be an unbiased system
ory guidance, where applicable wi
he construction and development

0-08-07/pd

shorter terms and acce
nd Good Nei
for first-time buyers,
arbitrarily discriminate based on race or other cha
S., but constructing more units at the
opers can deliver a
ship housing s
undamental to the

rban Development, Office o
ion of Eligible S
-20595, https://www.govinfo.gov/conten

reasi

eo
wi

ly self-sufficiency and unassi

— 515 —

impede construc
ortive impact
ouseholds that are looking for af

ties, allow escrow savi
ng househo

work requirements and o
use of capital and operati
th a possible two-year extension, whi
PHAs have imposed five

ready collects a

hin statuto
of new housi
nultifamily housing.
ace the Trump Administra
ed earlier rules expandi

ng an

. 85, No. 153 (August 7,

ary, “Affi

but th

more efficient cost
ock and better target |
housing supply chal

ion. Federal hous
stimulating grea

the Secretary, “Housin

ngs, and set

00 PHAs) in which particip

ng appropria

sted housing.

ngA
Fair Housing, “Preserving Comm
2020), pp. 47899-47912,
6320.pdf (accessed
matively Fur
February 9, 2023), pp. 8516-8590, h
6/pdf/2015-17032.pdf (accessed March 5, 2023).

greater take-up of loan products designed

erated amortization sch
ghbor Next Door (GNND) pilot initiati
ey should be available to al

or faster equi
edules. In concept, the

enge in marke

n
a

ing policy sho
er demand th
0

d incomes over eligibili
on for two-parent households.
requirements and term lim
oving to Work (
zed another 1
were given authority to implement rent reforms,

leadership can implement administrative reforms through regulatory

ng markets, including by

y, equity, and inclusion (DEI); critical race
der, and other people of color (BIPOC); and environmental, social,

nd assesses; at worst,

hat undermine integrity and perversely
or determining finan
y authorities, that adds

cial value.
d has been estimated to

tion’s “Preservi
FFH enforce

ng
ment.
unity

arch 5, 2023), and
hering Fair
tos://www.

ves might
eligible
acteristics.
low end of the market
new units that will allow
ncreased construction

S across

ct new housing
Id get out
rough loose
into the

constri

dable entry

g and Community

atus,” Proposed Rule, Federa/ Register, Vol. 84, No. 91
/pkg/FR-2019-05-10/pdf/2019-09566. pdf

maximum term
ty terms for housing

it policies in various congressionally
TW) demonstration

program established
ating MTW PHAs

her experimental policies in rental

ions.
ch could be applied

-year to seven-year term limits.
lity that helps to facilitate successful

37.

38.

39.

40.

Al.

42.

43.

44.

HUD should implement admi

enda
additi
The U
ways

Housi

cause

The Sena

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hem
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in the
estab

gov/1

Guiding questio
reforms can be done ad

cti
at

fun
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ben

more
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been

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ar-lef

under
hat reso
abuse
Admin

FHA did n
Federa

isadmi
Economic Recovery Ac

D and its programs to m
of these public
America be a seriously un
efit? What organization
The Fairc

October 21,
arch 5, 2023). In recent years, th
mvented through some narrow uses of preserva
ion (RAD) program, in
conversion caps. Congress also provid
ng public housing; project,

Demonstrat
program
exist

Mandate for Leadership: The Conservative Promise

\| Housing First directi
on to establishing re
S. Interagency Coun
istrations have devot
to provide federally
idea premised on
ng
yin

g causes of hom
ving the issue o
challenges. Instead
istration should shift
homelessness in the

mber 22, 2021, ht
ot facilitate th
Reserve policies,
onthly repaymen
ousing and Econo
nation’s housing

fal
n

nistered in the H

0/plaws/publ289/
ns: What re

-
ons that HUD admin
big-picture reform

inance su

S
ci

First answer to home

h
0)

iS
ves

)
ed

e be

essn

oth Amendmen

public housing than

998, Title V, h
circ
uni

en
inanced rapid rehousing a
ief that homelessness is primarily circumsta
eone a house instead of attem
ed on Housin
essness is often a matter of resolving mental heal
ive housing proffered by Housi
ha focus on addressing the un

essness is to give som

ome
the permanent suppor
0 transitional housing wi
irst place.
e Low-Income First-Time Homebuyers (LIFT) Act would address this policy goal. See S. 2797,
Low-Income First-Time Homebuyers Act of 2021

ps://www.congress.gov/1

e widespread use of 30-y
ederal agencies began

terms, result in slow equi
c Recovery Act of 2008 fundamenta
ance system, placing Fannie
ished Federal Housing Finance Agency (FH
UD Office of Community
of 2008, Public Law No.

LAW-Nl0publ289.pdf (accessed March
orms should be proposed th
nistratively, and what reforms
isters that could be achieved more e

den
le V, ht
As the evolu
choice vo

HRA). H

ps:

uch

s); and Section 8 uni
R. 2158, Depa

Homelessness (USIC
ormous resources

ess. Federal interven

ative changes in regulation an
Continuum of Care (CoC) grantees and contract h
ions on local Housing First polici
H) was est
0 the Housi
nd perman

ion cente

LIFT

i/o

s should be proposed that migh
eet the objectives in the vision or m
bsidies? How much crowd-out do these s
derhoused nation without these subsidies? Wh
al changes must be made?
(Quality Housing and Work Responsi
Act of 1937 to maintain public housing units at 1999
they did then. H.R. 4194, Departments o
opment, and Independent Agencies Appropriations Act, 1999, Publi
ttos://www.congress.gov/

e statutory restric

itially authorized in

s through the Multi

rtments o

Agencies Appropria

ion of

for rent in th
in various

could like

ways, inc

ions Act, 1998, Pub

//www.congress.gov/105/plaws/publ65/
HUD rental assistance transitions away
ers, there should be adequate
ese programs meets the demand for ren
uding by a task force instituted at th
y remain a challenge in the admin

broader adop
ty accumulati

FA) and estab
Plannin
10-289, 110th

evels, preventi

05/plaws/pub
ion on new construc

ed paths for renewa
/site-based housing stock (refinancing

es where HU
ablished in th
ng First model, experimen
ent housing oppor

dd guidance and see

ntial

| Homebuyers Act of 2021), 117

D gran
e 1990s, and numerous

g Firs

statutory authority to
omelessness providers in
funds are used.

ting with various
unities. Housing First is a
her than behavioral. The
pting to understand the
has failed to acknowledge
h and substance

ng First, a conservative
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DEPARTMENT OF

THE INTERIOR
William Perry Pendley

he U.S. Department of the Interior (DOD oversees, manages, and protects

the nation’s natural resources and cultural heritage; provides scientific

and other information about those resources; and honors the nation’s trust
responsibilities or special commitments to American Indians, Alaska Natives, and
affiliated island communities.

AGENCY OVERVIEW

DOI’s purview encompasses more than 500 million acres of federal lands,
including national parks and national wildlife refuges; 700 million acres of sub-
surface minerals; 1.7 billion acres of the Outer Continental Shelf (OCS); 23 percent
of the nation’s energy; water in 17 western states; and trust responsibilities for 566
Indian tribes and Alaska Natives. DOI’s 2024 budget request totals $18.9 billion, an
increase of $2 billion, or 12 percent, more than the 2023 enacted level. The budget
also provides an estimated $12.6 billion in permanent funding in 2024. In 2024,
DOI will generate receipts of $19.6 billion.

A “Home Department” had been considered in 1789 and urged by Presidents
over the decades until DOI’s creation in 1849. The variety of its early responsibil-
ities—the Indian Bureau, the General Land Office, the Bureau of Pensions, and
the Patent Office, among others—earned it various nicknames, including “Great
Miscellany,” “hydra-headed monster,” and “Mother of Departments.” Its mission
became more focused on natural resources with the rise of the conservation move-
ment in the early 20th century; however, it kept its historic (since the days of the
Founding Fathers) role as overseer of vast working landscapes involving grazing,

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Mandate for Leadership: The Conservative Promise

logging, mining, oil, and gas and, with the Bureau of Reclamation in 1902, as the
nation’s dam builder. Today, DOI has 70,000 employees in approximately 2,400
locations with offices across the United States, Puerto Rico, and U.S. Territories
and Freely Associated States.

Historically, DOI operated in a bipartisan manner consistent with the laws
enacted by Congress pursuant to its powers under the Property Clause.” Thus,
DOT fulfilled its statutory responsibilities in a manner that ensured the ability of
western states, counties, and communities to be sustained by both economic and
recreational activities on neighboring federal lands, especially given that in some
rural western counties, federal lands constituted 50, 60, 70, 80—even 90 percent
of the county’s landmass.*

That ended with the Administration of President Jimmy Carter, who, beholden
to environmental groups that supported his election, adopted DOI policies consis-
tent with their demands, much to the horror of western governors, most of whom
were Democrats. President Ronald Reagan campaigned against this “War on the
West,” declared himself a “Sagebrush Rebel,” and, on taking office,* quelled the
rebellion by reversing Carter Administration policies. President George H. W.
Bush distanced himself from Reagan’s western policies, committed to a “kinder
and gentler America,” and proclaimed his desire to be “the environmental Pres-
ident,” which resulted in changes at the his Administration’s DOI—again, much
to the dismay of westerners.° President Bill Clinton resumed Carter’s “War on
the West,” epitomized by his DOI’s deploying of wolves into the states bordering
Yellowstone National Park; the decreed death of a world-class mine in Montana;
and the designation of a vast national monument in Utah over the objections of
Utah leaders—but with the support of the Hollywood elite.®

Although Texas Governor George W. Bush and former Wyoming Representative
Dick Cheney (R-WY) campaigned in 2000 against Clinton’s worst outrages, includ-
ing the Utah monument, there was no significant ratcheting back of DOI policies
that were either objected to by westerners or contrary to the express provisions of
federal statutes. President Barack Obama’s DOI resumed the anti-economic fed-
eral lands policies activated by Carter and amplified by Clinton; however, Obama’s
DOT!’s antipathy to oil and gas activity on federal lands as mandated by Congress
could not have come at a worse time.

After the demonstrated success of fracking on Bureau of Land Management
(BLM) acreage in Wyoming in 1993, the fracking revolution soon swept the nation,’
yielding massive discoveries on state and private land from coast to coast, but not,
thanks to Obama, on western federal lands.* President Donald Trump, on the other
hand, immediately ordered his DOI to comply with federal law, conduct congressio-
nally mandated lease sales, and seek to achieve energy dominance or independence.
Thanks in part to the success of oil and gas operations on federal land in the West,
the United States achieved energy security for the first time since 1957 in 2019.°

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2025 Presidential Transition Project

President Joe Biden’s DOI, as is well documented, abandoned all pretense of
complying with federal law regarding federally owned oil and gas resources. Not
since the Administration of President Harry S. Truman—prior to creation of the
OCS oil and gas program—have fewer federal leases been issued.!°

At DOI, not since the Reagan Administration was the radical environmen-
tal agenda (first implemented by Carter, resumed by Clinton, and revitalized
by Obama) rolled back as substantially as it was by President Trump. Trump’s
DOI change affected not only oil and gas leasing, as noted above, but all statutory
responsibilities of its various agencies, bureaus, and offices. Thus, whether the
statutory mandate was to promote economic activity, to ensure and expand rec-
reational opportunities, or to protect valuable natural resources, including, for
example, parks, wilderness areas, national monuments, and wild and scenic areas,
efforts were expended, barriers were removed, and career employees were aided
in the accomplishment of those missions.

Unfortunately, Biden’s DOI is at war with the department’s mission, not only
when it comes to DOIT’s obligation to develop the vast oil and gas and coal resources
for which it is responsible, but also as to its statutory mandate, for example, to
manage much of federal land overseen by the BLM pursuant to “multiple use” and

“sustained yield” principles." Instead, Biden’s DOI believes most BLM land should
be placed off-limits to all economic and most recreational uses. Worse yet, Biden’s
DOI not only refuses to adhere to the statutes enacted by Congress as to how the
lands under its jurisdiction are managed, but it also insists on implementing a vast
regulatory regime (for which Congress has not granted authority) and overturning,
by unilateral regulatory action, congressional acts that set forth the productive
economic uses permitted on DOI-managed federal land.

BUDGET STRUCTURE

At $18.9 billion, DOI’s 2024 proposed budget is small relative to many other
federal agencies. On the other side of the ledger, the DOI forecasts it will generate
more than $19.6 billion in “offsetting receipts” from oil and gas royalties, timber
and grazing fees, park user fees, and land sales, among other sources. Most of the
proposed allocations are divided among nine bureaus.

Bureau of Indian Affairs. Fulfills Indian trust responsibilities on behalf of
566 Indian tribes; supports natural resource education, law enforcement, and
social service programs delivered by tribes; operates 182 elementary and secondary
schools and dormitories and 29 tribally controlled community colleges, universi-
ties, and post-secondary schools.

Bureau of Land Management. Manages and conserves resources for 245
million acres of public land and 700 million acres of subsurface federal mineral
estate, including energy and mineral development, forest management, timber
and biomass production, and wild horse and burro management.

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Mandate for Leadership: The Conservative Promise

Bureau of Ocean Energy Management. Manages access to renewable and
conventional energy resources of the Outer Continental Shelf, including more than
6,400 fluid mineral leases on approximately 35 million OCS acres; issues leases
for 24 percent of domestic crude oil and 8 percent of domestic natural gas supply;
oversees lease and grant issuance for offshore renewable energy projects.

Bureau of Reclamation. Manages, develops, and protects water and related
resources, including 476 dams and 337 reservoirs; delivers water to one in every
five western farmers and more than 31 million people; is America’s second-largest
producer of hydroelectric power.

Bureau of Safety and Environmental Enforcement. Regulates offshore oil
and gas facilities on 1.7 billion acres of the Outer Continental Shelf; oversees oil
spill response; supports research on technology for oil spill response.

National Park Service. Maintains and manages 401 natural, cultural, and
recreational sites, 26,000 historic structures, and more than 44 million acres of
wilderness; provides outdoor recreation; provides technical assistance and support
to state and local programs.

Office of Surface Mining Reclamation and Enforcement. Regulates coal
mining and site reclamation; provides grants to states and tribes for mining over-
sight; mitigates the effects of past mining.

U.S. Fish and Wildlife Service. Manages the 150-million-acre National Wild-
life Refuge System; manages 70 fish hatcheries and other related facilities for
endangered species recovery; protects migratory birds and some marine mammals.

U.S. Geological Survey. Conducts scientific research in ecosystems, climate,
and land-use change, mineral assessments, environmental health, and water
resources; produces information about natural hazards (earthquakes, volcanoes,
and landslides); leads climate change research for the department.

RESTORING AMERICAN ENERGY DOMINANCE

Given the dire adverse national impact of Biden’s war on fossil fuels, no other
initiative is as important for the DOI under a conservative President than the
restoration of the department’s historic role managing the nation’s vast store-
house of hydrocarbons, much of which is yet to be discovered. The U.S. depends
on reliable and cheap energy resources to ensure the economic well-being of its
citizens, the vitality of its economy, and its geopolitical standing in an uncertain
and dangerous world. Not only are valuable natural resources owned generally
by the American people involved, so too are those owned separately by American
Indian tribes and individual American Indians, both of which have been injured
by Biden’s illegal actions.

The federal government owns 61 percent of the onshore and offshore min-
eral estate of the U.S., but only 22 percent of the nation’s oil and 12 percent of U.S.
natural gas comes from those federal lands and waters—and even that amount is

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2025 Presidential Transition Project

declining. Additionally, 42 percent of coal production takes place on federal lands
in 11 states.’ DOI manages a subsurface mineral estate of 700 million acres onshore
and 1.76 billion acres offshore, for a total of 2.46 billion acres.

The total land area of the U.S. is 2.263 billion acres. Private and state lands,
at 1.563 billion acres, make up only 39 percent of the total onshore and offshore
subsurface area of the United States. Oil, natural gas, coal, and other minerals on
federal lands and waters are managed by the Bureau of Land Management, Bureau
of Ocean Energy Management, and Office of Surface Mining Reclamation and
Enforcement; these agencies’ responsibilities frequently overlap with resource
management by the U.S. Forest Service in the U.S. Department of Agriculture, state
governments, and private property owners.

Biden is “aligning the management of...public lands and waters...to support
robust climate action,” as envisioned in Executive Orders 14008 and 13990." One of
his first actions was to ban federal coal, oil, and natural gas leasing on federal lands
and waters to fulfill his campaign promise of “no federal oil,” followed by actions
from Interior Secretary Deb Haaland to rescind the Trump Administration’s
Energy Dominance Agenda. To this end, DOI unilaterally overhauled resource
management plans, lease sales, fees, rents, royalty rates, bonding requirements,
and permitting processes to prevent new production of coal, oil, and natural gas
on federal lands and waters; to dramatically increase production of solar and wind
energy; and to accomplish its “30 by 30,” “America the Beautiful” agenda to remove
federal lands from “multiple”—that is, productive—use.

DOL is abusing National Environmental Policy Act (NEPA) processes, the
Antiquities Act,’ and bureaucratic procedures to advance a radical climate agenda,
ostensibly to reduce greenhouse gas emissions, for which DOI has no statutory
responsibility or authority.’° The Federal Land Policy and Management Act
(FLPMA), Outer Continental Shelf Lands Act (OSCLA), General Mining Law,”
and other congressional acts clearly set forth multiple-use principles and processes
that include production of coal, oil, natural gas, and other minerals, as legitimate
activities consistent with the welfare of all Americans and of environmental
stewardship.

Biden’s DOI is hoarding supplies of energy and keeping them from Americans
whose lives could be improved with cheaper and more abundant energy while
making the economy stronger and providing job opportunities for Americans.
DOT is a bad manager of the public trust and has operated lawlessly in defiance of
congressional statute and federal court orders.

ADMINISTRATION PRIORITIES

Rollbacks. A new Administration must immediately roll back Biden’s orders,
reinstate the Trump-era Energy Dominance Agenda, rescind Secretarial Order
(SO) 3398, and review all regulations, orders, guidance documents, policies, and

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Mandate for Leadership: The Conservative Promise

similar agency actions made in compliance with that order.'* Meanwhile, the
new Administration must immediately reinstate the following Trump DOI sec-
retarial orders:

e §0 3348: Concerning the Federal Coal Moratorium;”

e $0 3349: American Energy Independence;?°

e $0 3350: America-First Offshore Energy Strategy;”!

e $0 3351: Strengthening the Department of the Interior’s Energy Portfolio;”

e §03352: National Petroleum Reserve—Alaska;*

e S$03354: Supporting and Improving the Federal Onshore Oil and Gas
Leasing Program and Federal Solid Mineral Leasing Program;*

e $0 3355: Streamlining National Environmental Policy Reviews and
Implementation of Executive Order 13807, “Establishing Discipline and
Accountability in the Environmental Review and Permitting Process for

Infrastructure Projects”;?°

e $0 3358: Executive Committee for Expedited Permitting;”°

e $0 3360: Rescinding Authorities Inconsistent with Secretary’s Order 3349,

“American Energy Independence;”””

e S03380: Public Notice of the Costs Associated with Developing Department
of the Interior Publications and Similar Documents;7°

e S§03385: Enforcement Priorities;?? and

e $0 3389: Coordinating and Clarifying National Historic Preservation Act
Section 106 Reviews.*°

Actions. At the same time, the new Administration must:
e Reinstate quarterly onshore lease sales in all producing states according to
the model of BLM’s IM 2018-034, with the slight adjustment of including

expanded public notice and comment.*! The new Administration should
work with Congress on legislation, such as the Lease Now Act® and

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2025 Presidential Transition Project

ONSHORE Acct,* to increase state participation and federal accountability
for energy production on the federal estate.

Conduct offshore oil and natural gas lease sales to the maximum extent
permitted under the 2023-2028 lease program,” with the possibility to
move forward under a previously studied but unselected plan alternative.*

Develop immediately and finalize a new five-year plan, while working with
Congress to reform the OCSLA by eliminating five-year plans in favor of
rolling or quarterly lease sales.

Review all resource management plans finalized in the previous four years
and, when necessary, select studied alternatives to restore the multi-use
concept enshrined in FLPMA and to eliminate management decisions that
advance the 30 by 30 agenda.

Set rents, royalty rates, and bonding requirements to no higher than what is
required under the Inflation Reduction Act.*

Comply with the Alaska National Interest Lands Conservation Act
(ANILCA) and the Tax Cuts and Jobs Act of 2017 to establish a competitive
leasing and development program in the Coastal Plain, an area of Alaska
that was set aside by Congress specifically for future oil and gas exploration
and development. It is often referred to as the “Section 1002 Area” after
the section of ANILCA that excludes the area from Arctic National Wildlife
Refuge’s wilderness designation.*”

Conclude the programmatic review of the coal leasing program, and work
with the congressional delegations and governors of Wyoming and Montana
to restart the program immediately.**

Abandon withdrawals of lands from leasing in the Thompson Divide of the
White River National Forest, Colorado; the 10-mile buffer around Chaco
Cultural Historic National Park in New Mexico (restoring the compromise
forged in the Arizona Wilderness Act*’); and the Boundary Waters area

in northern Minnesota if those withdrawals have not been completed.*°
Meanwhile, revisit associated leases and permits for energy and mineral
production in these areas in consultation with state elected officials.

Require regional offices to complete right-of-way and drilling permits
within the average time it takes states in the region to complete them.

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Mandate for Leadership: The Conservative Promise

Rulemaking. The following policy reversals require rulemaking:
e Rescind the Biden rules and reinstate the Trump rules regarding:
1. BLM waste prevention;

2. The Endangered Species Act rules defining Critical Habitat and Critical
Habitat Exclusions;*

3. The Migratory Bird Treaty Act; and
4. CEQ reforms to NEPA.**

e Reinstate President Trump’s plan for opening most of the National
Petroleum Reserve of Alaska to leasing and development.

Personnel Changes. The new Administration should be able to draw on the
enormous expertise of state agency personnel throughout the country who are
capable and knowledgeable about land management and prove it daily. States are
better resource managers than the federal government because they must live with
the results. President Trump’s Schedule F proposal“ regarding accountability in
hiring must be reinstituted to bring success to these reforms. Consistent with the
theme of bringing successful state resource management examples to the forefront
of federal policy, DOI should also look for opportunities to broaden state-federal
and tribal-federal cooperative agreements.

IMMEDIATE ACTIONS

BLM Headquarters. BLM headquarters belongs in the American West. After
all, the overwhelming majority of the 245 million surface acres (10 percent of the
nation’s landmass) managed by the agency lies in the 11 western states and Alaska:
Amere 50,000 surface acres lie elsewhere. Moreover, 97 percent of BLM employees
are located in the American West.

Thus, the Trump Administration’s decision to relocate BLM headquarters from
Washington, D.C., to the West was the epitome of good governance: That is, it was
not only well-informed, but it was also implemented efficiently, effectively, and
with an eye toward affected career civil servants. Plus, despite overblown chatter
from the inside-the-Beltway media, Congress, with bipartisan support, approved
funding the move.

Meanwhile, state, tribal, and local officials, the diverse collection of stakehold-
ers who use public lands and western neighbors became accustomed to having
top BLM decision-makers in Grand Junction, Colorado, rather than up to four

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2025 Presidential Transition Project

time zones away. All of them also appreciated that the BLM’s top subject matter
experts were located not in the District of Columbia, but in the western states
that most need their knowledge and expertise. Westerners no longer had to travel
cross country to address BLM issues. Neither did officials in the West, closest to
the resources and people they manage.

On July 16, 2019, Secretary of the Interior David L. Bernhardt delivered to Con-
gress the proposal for the relocation of nearly 600 BLM headquarters employees.
On August 10, 2020, Secretary Bernhardt formally established the Robert F. Burford
headquarters—named after the longest-serving BLM director, a Grand Junction
native—with a staff of 41 senior officials and assistants. Another 76 positions were
assigned to BLM state offices in western communities such as Billings, Montana;
Boise, Idaho; Reno, Nevada; Salt Lake City, Utah; and Cheyenne, Wyoming, to meet
critical needs. Scores of other positions were assigned to the states that required
BLM expertise. For example, wild horse and burro professionals were relocated
to Nevada, home to nearly 60 percent of these western icons. Sixty-one positions
were retained in Washington, D.C., to address public, congressional, and regulatory
affairs, Freedom of Information Act compliance, and budget development.

Despite the dislocating impact of the COVID-19 pandemic, the BLM success-
fully filled hundreds of long-vacant positions, as well as those that opened because
of the move West. The BLM saw notable numbers of applicants for these positions—
so numerous that the BLM capped the number of eligible applicants to no more
than 50. Obviously, reduced commuting times (often from hours to mere minutes),
lower cost of living, and opportunity to access vast public lands for recreation made
these jobs attractive to potential employees. Many, if not most, applicants stated
they would not have applied had the positions been based in Washington, D.C. At
the same time, western positions attracted those with the skills needed to meet
the BLM’s multiple-use, sustained-yield mandate, disproving the claim that the
BLM was suffering a “brain drain.”

The Trump Administration recognized that, despite its attractions, not every-
one employed by BLM in Washington, D.C., could move West. The Administration
applied a hands-on approach, with all-employee briefing and question-and-answer
sessions, regular email communications, and a website devoted to frequently asked
questions. Two human resources teams aided employees wishing to remain in
federal jobs in the D.C. area: All received new opportunities.

The BLM’s move West incurred no legal challenges, no formal Equal Employ-
ment Opportunity or U.S. Merit Systems Protection Board complaints, and no
adverse union activity. It is hard to please everyone, but the Trump Administra-
tion’s BLM did just that, putting the lie to assertions, by some, that the BLM was
trying to “fire” federal employees.

The total cost of $17.9 million for relocation incentives, permanent change-of-
station moves, temporary labor, travel, printing, rent, supplies, equipment, and

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Mandate for Leadership: The Conservative Promise

other contracts will save money for the American people. For example, in fiscal
2020, the BLM estimated $1.6 million in travel costs savings, which will grow
slightly over time, and $1.9 million in savings from its terminated lease in Wash-
ington, D.C. Furthermore, BLM estimated that, by October 2022, the BLM move
West would generate a net savings of $3.5 million, which, the following fiscal year,
would increase to $10.3 million.

Those funds can be devoted to reducing the risk of wildfires, increasing recre-
ational opportunities, conserving public lands, and addressing tough issues such
as wild horses and burros. Moreover, those funds will be used more wisely thanks
to the efficiency of senior, seasoned managers working closely with BLM field
employees in near daily contact with western officials, stakeholders, and neighbors.

In late 2022, Secretary of the Interior Deb Haaland announced the return of
headquarters and scores of highly paid, senior employees to Washington, D.C. Sub-
sequently, BLM Director Tracy Stone-Manning revealed 56 BLM jobs in BLM’s

“Western Headquarters” and 70 other BLM jobs will remain in Grand Junction,
an increase of 15 from the 41 announced by Trump’s BLM in 2019, and an increase
of 40 other jobs above the 16 first announced by Biden officials. Thus, the director,
the two deputy directors, six of seven assistant directors (ADs) and their staffs are
now or soon will be in Washington.

The Biden Administration failed to recognize the wisdom of having BLM’s lead-
ership, including its director, deputy directors, and ADs in the West. That is why,
decades ago, the AD and staff in charge of BLM’s firefighters were relocated to Boise,
Idaho, where they remain. Not so the head of BLM law enforcement and security,
who supervises over 200 uniformed law enforcement rangers and 76 special agents
stationed mainly in 11 western states and Alaska. Haaland moved that official to
Washington, far from state troopers, county sheriffs and deputies, and city police
with whom BLM law enforcement officers keep the peace in the West’s wide-open
spaces. BLM’s “top cop” might as well be on the moon.

The AD in charge of oil, gas, and minerals was also moved to Washington, D.C.,
notwithstanding that most oil, gas, and minerals are in the West and Alaska; New
Mexico’s Permian Basin, for example, is second only to Alaska in petroleum poten-
tial, and Montana and Wyoming’s Powder River Basin contains the world’s best
low-sulfur coal. The AD responsible for wild horses and burros was moved east as
well, despite the fact that the uncontrolled growth of wild horses and burros poses
an existential threat to public lands; 60 percent of the nation’s wild horses are in
Nevada,* but thousands are in nine other western states. There is no way these
and other ADs can professionally manage issues thousands of miles and multiple
time zones away.

It is not just effective and responsive management that has been lost; Colorado
lost its chance to become a must-visit destination for BLM’s stakeholders. Those
seeking to develop world-class mineral deposits in Minnesota or another Prudhoe

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2025 Presidential Transition Project

Bay in Alaska; to expand recreation across BLM’s vast, diverse, and unique land-
scapes; or to manage timber and rangelands to prevent wildfires, would all journey
to Grand Junction. Convention opportunities on Colorado’s western slope would
abound for BLM’s disparate constituencies to congregate and meet with BLM
leadership. The Western States Sheriffs’ Association, for example, whose annual
gathering attracts hundreds of law enforcement officers from 17 western and plains
states might have moved its event to Grand Junction.

Law Enforcement Officers. In 2002, at the direction of the Secretary of the
Interior in the days following the 9/11 attack, the Inspector General (IG) for DOI
made a series of department-wide recommendations regarding law enforcement.
Then-Secretary of the Interior Gale Norton ordered adoption of those recom-
mendations, which drew strong bipartisan support from Congress. Over the years,
most were implemented. One, however, remained undone: placing all BLM law
enforcement officers (LEOs), that is, its 212 Law Enforcement Rangers and 76
Special Agents, in an exclusively law enforcement chain of command.

This was not just the IG’s recommendation in 2002, but that of every IG who fol-
lowed. It is also the strong recommendation of the department’s top LEO. Moreover,
it has been the urgent recommendation of law enforcement professionals across
the country, especially in the West, for decades, including the Western States Sher-
iffs Association. Unfortunately, over time, BLM leadership stonewalled, adhering
to a haphazard system in which LEOs reported to non-LEO superiors, including
not only state directors, but also district and field managers with expertise in other
fields—range management or petroleum engineering, for example—with only 24
hours of law enforcement study. Obviously, those managers lack a comprehensive
understanding of law enforcement issues—constitutional, legal, and tactical. In
addition, they do not uniformly apply or enforce rules of conduct or ethical stan-
dards for LEOs and special agents, leading to weakened esprit de corps and morale.
Worse yet, because of their duties as managers of the multiple-use lands under
their jurisdiction, they are exposed to conflicts of interests and may intentionally
or unintentionally prevent LEOs from investigating violations or applying the law.

In the final days of the Trump Administration, Secretary David L. Bernhardt
ordered, and Deputy Director William Perry Pendley implemented, the IG’s recom-
mendation. Of course, leadership heads exploded; they were furious with their loss
of authority, not to mention subordinates and budgets. Unfortunately, in the first
days of the Biden Administration, BLM Deputy Director Mike Nedd suspended
Pendley’s order.

Nonetheless, LEOs, the BLM, and westerners want LEOs—who make life-and-
death decisions—to be as well-trained and well-equipped as possible. They should
report to a professional, expert, and knowledgeable chain of command. After all,
they protect visitors to BLM lands and the natural and cultural resources of those
lands, as well as the employees who manage those lands.

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Mandate for Leadership: The Conservative Promise

BLM’s LEOs must keep in touch, work closely, and coordinate with fellow fed-
eral, state, and local law enforcement officers. In the Trump Administration, they
joined state and local law enforcement in arresting dangerous suspects in Cortez,
Colorado; responded to a request from a rural sheriff in Arizona to rescue a family
stuck in freezing temperatures; and, teamed up in an all-hands-on-deck effort to
locate a missing American Indian teenager in rural Montana. More important,
western LEOs need the assurance that the BLM LEOs with whom they work are
professionals who report through a professional chain of command.

Wild Horses and Burros. In 1971, Congress ordered the BLM to manage wild
horses and burros to ensure their iconic presence never disappeared from the
western landscape. For decades, Congress watched as these herds overwhelmed
the land’s ability to sustain them, crowded out indigenous plant and other animal
species, threatened the survival of species listed under the Endangered Species
Act, invaded private and permitted public land, disturbed private property rights,
and turned the sod into concrete. BLM experts said in 2019 that some affected land
will never recover from this unmitigated damage.

There are 95,000 wild horses and burros roaming nearly 32 million acres in the
West—triple what scientists and land management experts say the range can sup-
port. These animals face starvation and death from lack of forage and water. The
population has more than doubled in just the past 10 years and continues to grow
at arate of 10 to 15 percent annually. This number includes the more than 47,000
animals the BLM has already gathered from public lands, at a cost to the American
taxpayer of nearly $50 million annually to care for them in off-range corrals.

This is not a new issue—it is not just a western issue—it is an American issue.
What is happening to these once-proud beasts of burden is neither compassionate
nor humane, and what these animals are doing to federal lands and fragile ecosys-
tems is unacceptable. In 2019, the American Association of Equine Practitioners
and the American Veterinary Medication Association—two of the largest organi-
zations of professional veterinarians in the world—issued a joint policy calling for
further reducing overpopulation to protect the health and well-being of wild horses
and burros on public lands. The National Wild Horse and Burro Advisory Board,
a panel of nine experts and professionals convened to advise the BLM, endorsed
the joint policy. Furthermore, animal welfare organizations such as the American
Society for the Prevention of Cruelty to Animals and the Humane Society of the
United States recognize that the prosperity of wild horses and burros on public
lands is threatened if herds continue to grow unabated.

The BLM’s multi-pronged approach in its 2020 Report to Congress* included
expanded adoptions and sales of horses gathered from overpopulated herds;
increased gathers and increased capacity for off-range holding facilities and pas-
tures; more effective use of fertility control efforts; and improved research, in
concert with the academic and veterinary communities, to identify more effective

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2025 Presidential Transition Project

contraceptive techniques and strategies. All of that will not be enough to solve
the problem, however. Congress must enact laws permitting the BLM to dispose
humanely of these animals.

IMMEDIATE ACTIONS REGARDING ALASKA

Alaska is a special case and deserves immediate action.*” When Alaska was
admitted to the Union in 1959, nearly its entire landmass was federally owned;
therefore, Alaska was granted the right to select 104 million acres (out of 375
million acres) to manage for the benefit of its residents.** In less than eight years,
Alaska selected 26 million acres. Then-Interior Secretary Stewart Udall—who
served during the Kennedy and Johnson Administrations—put a freeze on further
land selections to protect any claims that might be asserted by Native Alaskans.*”

Alaska Native Claims Settlement Act. The discovery of oil at Prudhoe Bay in
1968 made resolution of the issue by Congress a matter of urgency. As a result, in
1971, Congress passed the Alaska Native Claims Settlement Act (ANCSA), which
allowed the Native community to select 44 million acres.

Environmentalists, upset that too much of the land they coveted would be selected
by the state and Native Alaskans for development, demanded the inclusion in the act
of a provision— Section 17(d)(2)—that ordered the Interior Secretary to withdraw 80
million acres for future designation by Congress as parks, refuges, wild and scenic
rivers, and national forests.” The deadline for this congressional action was 1978,
and as it neared, the Carter Administration, impatient and worried, decided to force
Congress’s hand. The Administration unilaterally withdrew 100 million acres from
any use by the state or Native Alaskans.” Alaska promptly sued, charging that the
Administration had failed to comply with the National Environmental Policy Act.

In a lame duck session at the end of 1980, Congress passed (over the objec-
tions of the Alaskan delegation) the Alaska National Interest Lands Conservation
Act, which revoked all of the withdrawals of the Carter Administration and sub-
stituted congressional designations that put 100 million acres permanently in
federal enclaves, doubled the acreage of national parks and refuges, and tripled the
amount of land declared to be wilderness. Through all of this, Alaska pressed for
the DOI to convey the lands to which Alaska was entitled by federal law, but the
department grudgingly transferred only portions of that land.

By the time Ronald Reagan took office, Alaska had received less than half the
lands to which it was entitled after its admission into the Union, and Native Alas-
kans had received only one-third of the land due to them.* From January of 1981
through 1983, however, under Reagan, Alaska received 30 million acres and acom-
mitment of land transfers at the rate of 13 million acres annually. In the same
period, Native Alaskans received 11 million acres, which constituted nearly 60
percent of their entitlement, and an additional 15 million acres were transferred
by the end of 1988.°°

— 529 —

Mandate for Leadership: The Conservative Promise

Despite the passage of nearly 40 years since the end of the Reagan Adminis-
tration, the federal government has yet to fulfill its statutory obligation to Alaska
and Alaska Natives—specifically, each group has 5 million acres of entitlement
remaining. Standing in the way are Public Land Orders (PLOs) issued by the BLM
seizing that land for the agency. Those PLOs must be lifted to permit Alaska and
Alaska Natives to select what was promised by Congress.

For example, revocation of PLO 5150* will provide the state of Alaska 1.3 million
acres of its remaining state entitlement. This revocation should be a top priority.
BLM recommended this revocation in the 2006 report to Congress based on the
Alaska Land Transfer Acceleration Act, and the Interior Secretary has authority
to revoke based on the Alaska Native Claims Settlement Act under section d(1).*®
All other remaining BLM PLOs—all of which are more than 50 years old—should
be revoked immediately.

Alaska has untapped potential for increased oil production, which is important
not just to the revitalization of the nation’s energy sector but is vital to the Alaskan
economy. One-quarter of Alaska’s jobs are in the oil industry, and half of its overall
economy depends on that industry. Without oil production, the Alaskan economy
would be half its size.

Anew Administration must take the following actions immediately:

e Approve the 2020 National Petroleum Reserve Alaska Integrated Activity
Plan (NPRA-IAP) by resigning the Record of Decision. (Secretary Haaland’s
order reverted to the 2013 IAP, the science for which is out of date, unlike
the 2020 IAP.)

e Reinstate the 2020 Arctic National Wildlife Refuge Environmental Impact
Statement (EIS) by secretarial order and lift the suspension of the leases.

e Approve the 2020 Willow EIS, the largest pending oil and gas projection in
the United States in the National Petroleum Reserve-Alaska, and expand
approval from three to five drilling pads.”

Minerals. Alaska is not just blessed with an abundance of oil, it has vast
untapped mineral potential. Therefore, the new Administration must immedi-
ately approve the Ambler Road Project® across BLM-managed lands, pursuant
to the Secretary’s authority under the ANILCA and based on the Final Envi-
ronmental Impact Statement on the project.” This will permit construction of
a new 211-mile roadway on the south side of the Brooks Range, west from the
Dalton Highway to the south bank of the Ambler River, and open the area only
to mining-related industrial uses, providing high-paying jobs in an area known
for unemployment.

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2025 Presidential Transition Project

Wildlife and Waters. Throughout Alaska’s history, the federal government
has treated Alaska as less than a sovereign state. This is especially the case when
it comes to two of Alaska’s most valued resources, its wildlife and its waters.
Immediate action is required to end, at least in part, this injustice. Anew Admin-
istration should:

e Revoke National Park Service and U.S. Fish and Wildlife Service rules
regarding predator control and bear baiting, which are matters for state
regulation. Such revocation is permitted under the 2017 Congressional
Review Act.

e Recognize Alaska’s authority to manage fish and game on all federal lands
in accordance with ANILCA as during the Reagan Administration, when
each DOI agency in Alaska signed a Memorandum of Understanding with
the Alaska Department of Fish and Game ceding to the state the lead on fish
and wildlife management matters.”

e Issue a secretarial order declaring navigable waters in Alaska to be owned
by the state so that the lands beneath these waters belong to Alaska. This
will force the BLM to prove that water is not navigable, since in the case of
non-navigability, any submerged lands belong to the BLM. Currently, BLM
requires Alaska to prove navigability at its own expense—including the
BLM’s preposterous assertion that the mighty Yukon River is non-navigable.

e Reinstate President Trump’s 2020 Alaska Roadless Rule“ for the Tongass
National Forest in Alaska, which was replaced by a Biden Roadless Rule
that continues a 2001 Clinton rule affecting 9.37 million of the forest’s 16.7
million acres.® The Clinton rule affects an area where communities are in
small islands with no road access. It has prevented multiple infrastructure
projects, including roads, electric transmission lines, and water and sewer
projects, and it forces residents to use a heavily subsidized ferry system.
Logging has been shut down to the extent that New York harvests more
timber than does all of Alaska.

OTHER ACTIONS

The 30 by 30 Plan.” President Biden’s Executive Order 14008 (30 by 30
plan)*’ requires that the federal government, which already owns one-third of
the country: (1) remove vast amounts of private property from productive use;
and (2) end congressionally mandated uses of all federal land. The end result
will be “total federal control of an additional 440 million acres of land or oceans
in the US. by 2030.”

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Mandate for Leadership: The Conservative Promise

Although the new President should vacate that order, DOI under a conservative
President must take immediate action on the 30 by 30 plan by vacating a secre-
tarial order issued by the Biden DOI” that eliminated the Trump Administration’s
requirement for the approval of state and local governments before federal acquisi-
tion of private property with monies from the Land and Water Conservation Fund.”

National Monument Designations. As has every Democratic President before
him beginning with Jimmy Carter, Joe Biden has abused his authority under the
Antiquities Act of 1906. Like the outrageous, unilateral withdrawals from public use
of multiple use federal land under the Carter, Clinton, and Obama Administrations,
Biden’s first national monument was one in Colorado—adopted over the objections
of scores of local groups and at least one American Indian tribe.” In the days before
the 2024 election, Biden will likely designate more western monuments.

Although President Trump courageously ordered a review of national mon-
ument designations, the result of that review was insufficient in that only two
national monuments in one state (Utah) were adjusted.”” Monuments in Maine
and Oregon, for example, should have been adjusted downward given the finding
of Secretary Ryan Zinke’s review that they were improperly designated. The new
Administration’s review will permit a fresh look at past monument decrees and
new ones by President Biden.

Furthermore, the new Administration must vigorously defend the downward
adjustments it makes to permit a ruling on a President’s authority to reduce the
size of national monuments by the U.S. Supreme Court.

Finally, the new Administration must seek repeal of the Antiquities Act of 1906,
which permitted emergency action by a President long before the statutory author-
ity existed for the protection of special federal lands, such as those with wild and
scenic rivers, endangered specials, or other unique places. Moreover, in recent
years, Congress has designated as national monuments those areas deserving of
such congressional action.

Oregon and California Lands Act. One national monument worthy of down-
ward adjustment is in Oregon, where its designation and subsequent expansion
interfere with the federal obligation to residents to harvest timber on its BLM
lands. A federal district court ruled in 2019 that land subject to the Oregon and
California (O&C) Grant Lands Act of 193773 was set aside by Congress to be har-
vested for the benefit of the people of Oregon. Specifically, those federal lands are
to be “managed...for permanent forest production” and its timber “sold, cut, and
removed in conformity with the princip[le] of sustained yield.””

As the district court concluded,” beginning in 1990, the federal government
erected a trifecta of illegal barriers to the accomplishment of the congressional
mandate, beginning with a response to the listing of the northern spotted owl,”
continuing a decade later with the designation of the Cascade- Siskiyou National
Monument,” and concluding in 2017 with an expansion of that monument.” In

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2025 Presidential Transition Project

order to fulfill the yet-unaltered congressional mandate contained in federal law,
to provide for jobs and well-paying employment opportunities in rural Oregon,
and to ameliorate the effects of wildfires, the new Administration must immedi-
ately fulfill its responsibilities and manage the O&C lands for “permanent forest
production” to ensure that the timber is “sold, cut, and removed.””

NEPA Reforms. Congress never intended for the National Environmental
Policy Act to grow into the tree-killing, project-dooming, decade-spanning mon-
strosity that it has become. Instead, in 1970, Congress intended a short, succinct,
timely presentation of information regarding major federal action that signifi-
cantly affects the quality of the human environment so that decisionmakers can
make informed decisions to benefit the American people.

The Trump Administration adopted common-sense NEPA reform that must
be restored immediately. Meanwhile, DOI should reinstate the secretarial orders
adopted by the Trump Administration, such as placing time and page limits on
NEPA documents and setting forth—on page one—the costs of the document itself.
Meanwhile, the new Administration should call upon Congress to reform NEPA
to meet its original goal. Consideration should be given, for example, to eliminat-
ing judicial review of the adequacy of NEPA documents or the rectitude of NEPA
decisions. This would allow Congress to engage in effective oversight of federal
agencies when prudent.

Settlement Transparency. Interior Secretary David Bernhardt required DOI
to prominently display and provide open access to any and all litigation settlements
into which DOI or its agencies entered, and any attorneys’ fees paid for ending
the litigation.®° Biden’s DOI, aware that the settlements into which it planned to
enter and the attorneys’ fees it was likely to pay would cause controversy, ended
this policy.*! A new Administration should reinstate it.

The Endangered Species Act. The Endangered Species Act was intended
to bring endangered and threatened species back from the brink of extinction
and, when appropriate, to restore real habitat critical to the survival of the spe-
cies. The act’s success rate, however, is dismal. Its greatest deficiency, according
to one renowned expert, is “conflict of interest.”*? Specifically, the work of the
Fish and Wildlife Service is the product of “species cartels” afflicted with group-
think, confirmation bias, and a common desire to preserve the prestige, power,
and appropriations of the agency that pays or employs them. For example, in one
highly influential sage-grouse monograph, 41 percent of the authors were federal
workers. The editor, a federal bureaucrat, had authored one-third of the paper.**

Meaningful reform of the Endangered Species Act requires that Congress
take action to restore its original purpose and end its use to seize private prop-
erty, prevent economic development, and interfere with the rights of states over
their wildlife populations. In the meantime, a new Administration should take the
following immediate action:

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Mandate for Leadership: The Conservative Promise

Delist the grizzly bear in the Greater Yellowstone and Northern
Continental Divide Ecosystems and defend to the Supreme Court of the
United States the agency’s fact-based decision to do so.**

Delist the gray wolf in the lower 48 states in light of its full recovery
under the ESA.*°

Cede to western states jurisdiction over the greater sage-grouse,
recognizing the on-the-ground expertise of states and preventing use
of the sage-grouse to interfere with public access to public land and
economic activity.

Direct the Fish and Wildlife Service to end its abuse of Section 10(j) of the
ESA by re-introducing so-called “experiment species” populations into
areas that no longer qualify as habitat and lie outside the historic ranges
of those species, which brings with it the full weight of the ESA in areas
previously without federal government oversight.*°

Direct the Fish and Wildlife Service to design and implement an impartial
conservation triage program by prioritizing the allocation of limited
resources to maximize conservation returns, relative to the conservation
goals, under a constrained budget.*”

Direct the Fish and Wildlife Service to make all data used in ESA decisions
available to the public, with limited or no exceptions, to fulfill the public’s
right to know and to prevent the agency’s previous opaque decision-making.

Abolish the Biological Resources Division of the U.S. Geological Survey
and obtain necessary scientific research about species of concern from
universities via competitive requests for proposals.

Direct the Fish and Wildlife Service to: (1) design and implement an
Endangered Species Act program that ensures independent decision-
making by ending reliance on so-called species specialists who have
obvious self-interest, ideological bias, and land-use agendas; and (2) ensure
conformity with the Information Quality Act.*

Office of Surface Mining. The Office of Surface Mining Reclamation and

Enforcement (OSM) was created by the Surface Mining Control and Reclamation
Act of 1977 (SMCRA)*® to administer programs for controlling the impacts of surface
coal mining operations. Although the coal industry is contracting, coal constitutes

— 534 -—

2025 Presidential Transition Project

20 percent of the nation’s electricity and is a mainstay of many regional economies.

The following actions should ensure OSM’s ability to perform its mission while com-
plying with SMCRA and without interfering with the production of high-quality
American coal:

Relocate the OSM Reclamation and Enforcement headquarters to
Pittsburgh, Pennsylvania, to recognize that the agency is field-driven and
should be headquartered in the coal field.”°

Reduce the number of field coal-reclamation inspectors to recognize the
industry is smaller.

Reissue Trump’s Schedule F executive order to permit discharge of
nonperforming employees.”!

Permit coal company employees to benefit from the OSM Training
Program, which is currently restricted to state and federal employees.

Revise the Applicant Violator System, the nationwide database for the
federal and state programs, to permit federal and state regulators to
consider extenuating circumstances.

Maintain the current “Ten-Day Notice” rule, which requires OSM to work
with state regulators in determining if a SMCRA violation has taken place in
recognition of the fact that a coal mining state with primacy has the lead in
implementing state and federal law.

Preserve Directive INE-26, which relates to approximate original contour,
a critical factor in permitting efficient and environmentally sound surface

mining, especially in Appalachia.”

Western Water Issues. The American West, from the Great Plains to the Cas-

cades Range, is arid, as recognized by John Wesley Powell during his famous trip

across a large part of its length. Pursuant to an Executive Order signed by President

Trump, and consistent with its authority along with other federal agencies, DOI’s

Bureau of Reclamation must take the following actions:

Develop additional storage capacity across the arid west, including by:

1. Updating dam water control manuals for existing facilities during
routine operations; and

— 535 —

Mandate for Leadership: The Conservative Promise

2. Engaging in real-time monitoring of operations.

e Reduce bureaucratic inefficiencies by consolidating federal water
working groups.

e Implement actions identified in the Federal Action Plan for Improving Fore-
casts of Water Availability,°? especially by adopting improvements related to:

1. Forecast Informed Reservoir Operations; and
2. Arial Snow Observation Systems.

e = Clarify the Water Infrastructure Finance and Innovation Act™ to ensure
consistent application with other federal infrastructure loan programs
under the Federal Credit Reform Act. This should be done to foster
opportunities for locally led investment in water infrastructure.

e Reinstate Presidential Memorandum on Promoting the Reliable Supply
and Delivery of Water in the West.°°

AMERICAN INDIANS AND U.S. TRUST RESPONSIBILITY

The Biden Administration has breached its federal trust responsibilities to
American Indians. This is unconscionable. Specifically, the Biden Administra-
tion’s war on domestically available fossil fuels and mineral sources has been
devastating. To wit:

e The ability of American Indians and tribal governments to develop their
abundant oil and gas resources has been severely hampered, depriving
them of the revenue and profits to which they are entitled during a time of
increasing worldwide energy prices, forcing American Indians—who are
among the poorest Americans—to choose between food and fuel.

e Indian nations with significant coal resources have some of the
highest quality and cleanest-burning coal in the world, but the Biden
Administration has sought to destroy the market for their coal by
eliminating coal-fired electricity in the country and to prevent the transport
of their coal for sale internationally. Meanwhile, the Biden Administration,
at great public expense, artificially boosted the demand for electric
vehicles, which, because of their remote locations, the absence of increased
electricity demands for charging electric vehicles nearby, and the distances
to be traveled, are not a choice for Indian communities.

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2025 Presidential Transition Project

e Asignificant percentage of critical minerals needed by the United States
is on Indian lands, but the Biden Administration has actively discouraged
development of critical mineral mining projects on Indian lands rather than
assisting in their advancement.

e Despite Indian nations having primary responsibility for their lands and
environment and responsibility for the safety of their communities, the
Biden Administration is reversing efforts to put Indian nations in charge of
environmental regulation on their own lands.

Moreover, Biden Administration policies, including those of the DOL, have dis-
proportionately impacted American Indians and Indian nations.

e Byits failure to secure the border, the Biden Administration has
robbed Indian nations on or near the Mexican border of safe and secure
communities while permitting them to be swamped by a tide of illegal drugs,
particularly fentanyl.

e When ending COVID protocols at Bureau of Indian Education (BIE) schools,
Biden’s DOI failed to ensure an accurate accounting of students returning
from school shutdowns, which presents a significant danger to the families
that trust their children to that federal agency.

e The BIEFis not reporting student academic assessment data to ensure
parents and the larger tribal communities know their children are learning

and are receiving a quality education.

The new Administration must take the following actions to fulfill the nation’s
trust responsibilities to American Indians and Indian nations:

e End the war on fossil fuels and domestically available minerals and
facilitate their development on lands owned by Indians and Indian nations.

e End federal mandates and subsidies of electric vehicles.

e Restore the right of tribal governments to enforce environmental
regulation on their lands.

e Secure the nation’s border to protect the sovereignty and safety of
tribal lands.

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Mandate for Leadership: The Conservative Promise

e Overhaul BIE schools to put parents and their children first.

Finally, the new Administration should seek congressional reauthorization
of the Land Buy-Back Program for Tribal Nations,®° which provided a $1.9 bil-
lion Trust Land Consolidation Fund to purchase fractional interests in trust or
restricted land from willing sellers at fair market value, but which sunsets Novem-
ber 24, 2022. New funds should come from the Great American Outdoors Act.”

AUTHOR’S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but some
deserve special mention. Kathleen Sgamma, Dan Kish, and Katie Tubb wrote the section on energy in its entirety. |
received thoughtful, knowledgeable, and swift assistance from Aubrey Bettencourt, Mark Cruz, Lanny Erdos, Aurelia
S. Giacometto, Casey Hammond, Jim Magagna, Chad Padgett, Jim Pond, Rob Roy Ramey Il, Kyle E. Scherer, Tara
Sweeney, John Tahsuda, Rob Wallace, and Gregory Zerzan. The author alone assumes responsibility for the content
of this chapter; no views expressed herein should be attributed to any other individual.

— 538 —

ENDNOTES
1.
2.
Regulations respec
3. — In Wyoming, the fe
4. Pendley, Sagebrush Rebel.
5. — Keith Schneider, “T
6.
7.
State Daily, April 5,
9. Ibid
9.
235¢22e54687.htm
10. Ibid.
11.
12.
13.
Protecting Public H
arch 16, 2023).
14.
15.
16. “You know what th
D'Angelo, “Interior
ay 9, 2019.
17.
18.
Protecting Public
arch 16, 2023).
19. U.S. Department o
20. U.S. Department o
arch 16, 2023).
21. U.S. Department o
arch 16, 2023).
22. U.S. Department o
counselor-508. pdf
23. U.S. Department o

2025 Presidential Transition Project

See generally William Perry Pendley, Sagebrush Rebel: Reagan’s Battle with Environmental Extremists and
Why It Matters Today (Regnery, 2013), preface, pp. XVi-xxii.
U.S. Const. art. IV, § 3, cl. 2. “The Congress shall have Power to dispose of and make all needful Rules and

ting the Territory or other Property belonging to the United States.”
deral government owns 48 percent of the land; in Wyoming's Teton County, the federal

government owns 97 percent of the land.

he 1992 Campaign; Bush on the Environment: A Record of Contradictions,” New York Times,

July 4, 1992, httos://www.nytimes.com/1992/07/04/us/the-1992-campaign-bush-on-the-environment-a-

record-of-contradictions.html (accessed March 15, 2023).

William Perry Pendley, War on the West: Government Tyranny on America’s Great Frontier (Regnery, 1995).
William Perry Pendley, “Bureau of Land Management Yesterday and Today: Energy Independence,” Cowboy

2022, https://cowboystatedaily.com/2022/04/05/bureau-of-land-management-

yesterday-and-today-energy-independence/ (accessed March 15, 2023).

William Perry Pendley, “Perspective: Biden’s War on Western Energy,” The Gazette, November 6, 2022, https://
gazette.com/opinion/perspective-biden-s-war-on-western-energy/article_3823a584-5bb2-lled-a598-

(accessed March 15, 2023).

ultiple-Use Sustained-Yield Act of 1960, Public Law 86-517.
Federal Register, Vol. 86, No. 159 (August 20, 2021), pp. 46873-46877.
Federal Register, Vol. 86, No. 19 (February 1, 2021), pp. 7619-7633, and White House, “Executive Order on

ealth and the Environment and Restoring Science to Tackle the Climate Crisis,” January

20, 2021, https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-
protecting-public-health-and-environment-and-restoring-science-to-tackle-climate-crisis/ (accessed

ational Environmental Policy Act, Public Law 91-160.

Antiquities Act of 1906, Public Law 59-209.

ere’s not is a shall for? ‘I shall manage the land to stop climate change,’ or something

similar to that,” Secretary of the Interior David Bernhardt testified. “You guys come up with the shalls.” Chris

Secretary Blames Congress for His Inaction on Climate Change,” High Country News,

Federal Land Policy and Land Management Act of 1976, Public Law 94-579; Outer Continental Shelf Lands Act,
Public Law 95-372; and 30 U.S.C. § 21 et seq.
U.S. Department of the Interior, “Order No. 3398: Revocation of Secretary’s Orders Inconsistent with
Health and the Environment and Restoring Science to Tackle the Climate Crisis,” April
6, 2021, httos://www.doi.gov/sites/doi.gov/files/elips/documents/so-3398-508_0.pdf (accessed

he Interior, “Order No. 3348: Concerning the Federal Coal Moratorium,” March 29, 2017,

https://www.doi.gov/sites/doi.gov/files/uploads/so_3348_coal_moratorium.pdf (accessed March 16, 2023).

he Interior, “Order No. 3349: American Energy Independence,” March 29, 2017, https://

www.doi.gov/sites/doi.gov/files/uploads/so_3349_-american_energy_independence.pdf (accessed

he Interior, “Order No. 3350: America First Offshore Energy Strategy,” May 1, 2017,

https://www.doi.gov/sites/doi.gov/files/press-release/secretarial-order-3350-offshore-508.pdf (accessed

he Interior, “Order No. 3351: Strengthening the Department of the Interior’s Energy

Portfolio,” May 1, 2017, https://www.doi.gov/sites/doi.gov/files/press-release/secretarial-order-3351-energy-

(accessed March 16, 2023).
he Interior, “Order No. 3352: National Petroleum Reserve—Alaska,” May 31, 2017, https://

www.doi.gov/sites/doi.gov/files/uploads/so-3352.pdf (accessed March 16, 2023).

— 539 —

24.

25.

26.

27.

28.

29.

30.

41.

32.
33.

34,
bo;

36.
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ORE Act, S. 218, 16th Cong., 2nd Sess. (2019). https://www.congress.gov/bil
arch 18, 2023).
Federal Register, Vol. 87, No. 130 (July 8, 2022), pp. 40859-40863.

inconsistent_with_secretarys_order_ 3349 american_energy

Public Notice of the Costs Associated with Developi
March 10, 2020, https://www.doi.go'

ch 16, 2023).

dinating and Clarifying National His

ann

J6th-congress/se

ng
v/sites/

4, 2020, https://
ies.pdf (accessed

oric Preservation Act
ps/documents/signed-

ing and Lease Parcel

nate-

The Biden Administration's 2023-2028 proposed program is fatally flawed. Katie Tubb, “Comment for the

2023-2028
thf_m
comm
See In

ent%20KTubb.pd
lation Reduction

edia.s3.amazonaws.com/2022/Regulatory_Comments/BOEM%202023-2028%20lease%20plan
(accessed March 16, 2023).
Act of 2022, Public Law No.

17-169, 8§ 50261-50263.

ational OCS Oil and Gas Leasing Proposed Program,” BOEM-2022-0031, October 6, 2022, http://

%20

Tax Cuts a
3401: Com
othe
documen
wildli
n 2016, In
programn
incon

Coasta

e-refuge-rela

sistency with

nd Jobs Act of

s/so-3401-comprehensive-ana
ing-to-the-coastal-p!
or Secretary Sally Jewell insti
ronmenta

the Obama Adminis

ys
ain-

teri
natic envi

he mora
nteri

or Secretary Debra Haa

orium and ended development of
and rescinded

prehensive Analysis and Temporary Halt on
Plain Oil and Gas Leasing Program,” June 1, 2021, https://www.doi.gov/sites/doi.gov/files/e
is-and-temporary-halt-on-all-activitives-in-

utedam
impact statement under NEPA to address concerns abou
ate policy. In
programmatic envi
Zinke’s order and initi

ration’s clim

2017, Public Law No. 115-97, § 20001, and U.S. Department of th
All Activities in the Arctic Nationa

-and-gas-|
orat

No.
Relating
ips/
|-

e Interior, “Orde
Wildlife Refuge

he-arctic-nationa
arch 16, 2023).
e conducting a
competition and

ry Ryan Zinke lifted

ement. In April 2021,
the coal-leasing

easing-program.pdf (accessed
orium on new coal leases whi

2017, Interior Secreta
ronmental impact sta
ated a new review 0

program. See U.S. Department o
mpact Statement to Modernize
gov/
0 _modernize_the_federal_coa

iles/elips/documents/archived-3338_-

the Inter

program

“Order No. 3348”; U.S. Departmen

t of the In

(August 20, 2021), pp. 46873-46877.

Or,
he Federal Coal Program,” January 15, 2016, https://www.doi.gov/si
iscretionary_programmatic_environmental_impact_sta

“Order No. 3338: Discretionary Programmatic Environm

ental
es/doi.
ement_

df (accessed March 16, 2023); U.S. Department of the In
ior, “Order No. 3398”; and Federal Register, Vol. 86, No.

— 540 —

erior,
59

39.

40.

Al.

42.

43.

44.

AS.

46.

47.
48.

49.

50.

ol.

52:

2025 Presidential Transition Project

Katie Tubb, “No More Standoffs: Prote

Attacks and Abuse,” testimony before the Subcommittee on National
Committee on Natural Resources, U.S. House of Representatives, pp. 2-4, October 22, 2019, ht
gov/116/meeting/house/

News release, “Se
Canyon Landscap

secretary-haaland-announces-steps-
ews release,
of the Interi

16, 2023);

Departmen
proposes-protecti
Action to Comple
20, 2021, ht
waters-area-wate
ineral Leases Im

0104/wi
cretary Haaland An
e,” U.S. Departmen

“Biden-Harr
or, October
ons-thompson-div
e Study of Bounda

ps://www.doi.gov/pressreleases/biden-admi
accessed March 16, 2023); an

rshed

nesses/H

ide (accessed March 16, 2023);

cting Federal Employees and Ending the Culture of Anti-Government

nounces Steps to Establish Pro
of the In
estab
is Administration Proposes Protections for Thompson
2, 2022, https://www.doi.gov/pressreleases/biden-har

ections for Culturally Si

y Waters Area Watershed,” U.S. Department of the In
nistration-takes-action-complete-s

d News release, “Interior Depar

properly Renewed

the Interior, January 26, 2022, https://www.doi.gov/pressreleases/in
ineral-leases-im

properly-renewed-

ndangered Spec

Nom

o> &

ino Gran

Do
October 21, 2020,
Ka
20

hleen Maste

a Sustainable H
Final%20

James D. Linxwi
ineral Law Ins

bid., § 12.03(1)

arch 16, 2023).

doni and An
Reversing Trump,’
environment/2022/04/19/biden-nepa-climate-
tive Order on Creating Schedule F in the Accepted Service,” Executive Order 13957,
ives.gov/presidential-actions/executive-order-creating-

nald Trump, “Execu
tos://trumpwhitehouse.arch
schedule-f-excepted-service/ (accessed March
evada Wild Horse Population Skyrockets To New High,” KUNR Public Radio, July 22,
9, https://www.kunr.org/energy-and-environ
o-new-high (accessed March 20, 2023).

U.S. Department of the Interior, Bureau of Land
orse and Burro Program,” Fact s

son, “

, 1981, http://www.a

43 U.S. Code, Ch. 33.
in “seed money.” Lin

ands as federal enc

e Service, “Gover!

ashington Post,

ies Act, Public Law 91-135, § 4(b)(2),
020), pp. 82376-82389.
S. Fish and Wildli
ps://www.fws.gov/regulations/mbta (accessed March
na Phillips, “Biden Restores Clima

in the Watershed of the Boundary Wa
erior-department-ta
watershed-boundary (accessed March 16, 2023).

and Federal Register,

ning the Take of Migratory Birds Unde
16, 2023).
e Safeguards in Key
tos://www.washington

rump/ (accessed March 16, 2023).

he Migratory B

Environmental

April 19, 2022, h

6, 2023).
ment/2019-07-22/nevada-wild-horse-popu

Management, “Report to Congress: An Anal

HRG-116-I110-Wstate-TubbK-20191022.pdf (accessed

ment 1
ers Wilderness,”

Vol. 85, No. 244

post.com/clima

Parks, Forests, and Public Lands,

ps://congress.
arch 16, 2023).
gnificant Chaco

erior, November 15, 2021, https://www.doi.gov/pressreleases/
ish-protections-culturally-significant-chaco (accessed March
Divide,” U.S.

is-administration-

ews release, “Biden Administration Takes

erior, October
udy-boundary-
Takes Action on
U.S. Department
kes-action-

(December 18,

rd Treaty Act.”

Law,
e-

lation-skyrockets-

ysis of Achieving

heet, May 8, 2020, https://www.blm.gov/sites/blm.gov/files/
Fact%20Sheet%20WHB%20Report%2010%20Congress.pdf (accessed March 17, 2023).

Pendley, Sagebrush Rebel, pp. 45-47.
ler, The Alaska Native Claims Settlement Act At 55: Delivering on the Promise, Rocky Mountain
itute, Vol. 53, Chap. 12 (2007), § 12.03(1)(a)(iv), https://www.guessrudd.com/wp-content/
uploads/sites/1600422/2020/05/The-Alaska-Native-Claims-Settlement-Act-at-35.pdf (accessed March 16, 2023).
a)(vii). See generally Richard S. Jones, Alaska Native Claims Settlement Act of 1971 (Public
Law 92-203): History And Analysis Together With Subsequent Amendments, Report No. 81-127 GOV, June
askool.org/PROJECTS/ANCSA/reports/rsjones1981/ANCSA_ History71.htm (accessed

ANCSA also created 12 Native-owned regional corporations and authorized $962 million
xwiler, The Alaska Native Claims Settlement Act At 35, § 12.03(2)(e).
CSA provided that the withdrawal of the lands would expire in 1978 if Congress had not designated the
aves. John K. Norman Cole and Steven W. Silver, Alaska’s D-2 Lands, Rocky Mountain
ineral Law Institute, Vol. 6B, Ch. 5, September 1978, and Raymond A. Peck, Jr., And Then There Were None:
Evolving Federal Restraints on the Availability of Public Lands for Mineral Development, Rocky Mountain
ineral Law Institute, Vol. 25, Ch. 3, 1979.
Andrus used purported authority under the FLPMA to withdraw 40 million acres, and Carter used purported
uthority under the Antiquities Act of to withdraw 56 million acres. James D. Linxwiler, The Alaska Native

Claims Settlement Act: The First Twenty Years, Rocky Mountain Mineral Law Institute, Vol. 38 Ch. 2, 1992 at
2.04(8)(0), https://ancsa.lbblawyers.com/wp-content/uploads/ANCSA-Paper-with-Table-of-Contents-1992.pdf

(accessed March 1

6, 2023).

— 541 —-—

55;

54.

55.

56.

Mandate for Leadership: The Conservative Promise

Alaska’s request for an injunction was denied. State of Alaska v. Carter, 462 F. Supp.
978) (NEPA does not apply to presidential proclamations under the Antiquities Act). Alaska’s lawsuit was
ng use of the Antiquities Act to designate
p. 890 (D. Wyo. 1945). See generally Carol Hardy Vincent and

onument.
Kristina Alexander,
Conagress, R41330, J
R41330_2011Aug22
ational Interest La
its lawsuit.
Alaska Nationa

similar to one filed by Wyoming challengi
/yorming v. Franke, 58 F. Sup

Interest Lands Conservati

155, 1156 (D. Alaska

he Grand Teton National

“National Monuments and the Antiquities Act,’ Congressional Research Service Report for
uly 20, 2010, https://digital.library.unt.edu/ark:/67531/metadc813640/m2/1/high_res_d/

pdf (accessed March

6, 2023). In December 1980, President Carter signed the Alaska
nds Conservations Act; subsequen

ly, during the Reagan Administration, Alaska dropped

on Act, Public Law 96-487 (codified as amended in scattered

sections of 16 U.S.C., 43 U.S.C. 48 U.S.C), and Joseph J. Perkins, Jr, Zhe Great Land Divided But Not
Conquered: The Effects of Statehood, ANCSA, and ANILCA on Alaska, Rocky Mountain Mineral Law Institute,

Vol. 34, Ch. 6, 1988,
U.S. Department of
October 1983, p. 25,

§ 6.02.

the Interior, 1983: A Year Of Enrichment: Improving The Quality Of Life For All Americans,

006/40_047_7006969_006_022_2017.pdf (access

Ibid. The conveyanc

es by the Reagan Administration

https://www.reaganlibrary.gov/public/digitallibrary/smof/publicliaison/blackwell/box-

ed March 16, 2023).
to Alaska and Native Alaskans greatly exceeded the

amount of land transferred to each during the Carter Administration. See U.S. Department of the Interior,

1983: A Year Of Enrichment, pp. 86-87.
Federal Register, Vol. 36,

0. 252 (December 31, 1971), pp. 25410-25412. “On December 28, 1971, ten days

er enactment of ANCSA, the Secretary of Interior through his Assistant Secretary issued Public Land Order
(PLO) 5150 which withdrew and reserved various federal public lands, subject to valid existing rights, as a

58.
59.

60.

61.

62.
63.

64.
65.
66.

67.

(Prudhoe Bay) south
Alaska 1979).
A

hilip Elliott, “Biden

as company to ma
Alaska Department o

utility and transportation corridor
order was issued ‘by virtue of the authority vested in the Presi
y 26, 1952 (17 Fed. Reg. 4831)....PLO 5150 established a corri

0 Valdez on Prince William Sound.” Wisenak, Inc. v. Andrus, 471 F. Supp.

or th

aska Land Transfer Acceleration Act, Public Law 108-452.
Pp ay Be About to Sign Off on a Huge Alaska Oil Drilling Project,” Time, December 13, 2022,
https://time.com/6240733/biden-alaska-oil-drilling-willow-project/ (accessed March 16, 2023). A Biden
a
g

e the huge investment necessary to operate in NPRA.

dnr.alaska.gov/mlw/ambler-road/ (accessed March 17, 2023).

Vol. 1, March 2020, h

5 US. Code § 801(a)(1)(A).

U.S. Department of the Interior, *
0

the Interior, “Master Memoran
a and the U

Game, Juneau, Alas
Interior, “

lup/66967/84127/100727/Memo

‘Mas

Fish and Game, Juneau, Alaska and the U.S. Natio

dum
S. Fi

aster Memorandum of Understanding Be
Alaska and the Bureau of Land Management,” August 3, 1983,

Federal Register, Vol. 85, No. 210 (Oc

Federal Register, Vol. 88, No. 18

EIS Volume_l-_Chp_1-3_& Appendices _A-F_.pdf (accessed March 18, 2023).

e Alaska oil pipeline. 36 Fed. Reg. 25410 (December 31,

971). The land

dent and pursuant to Executive Order 10355 of
dor extending from the North Slope of Alaska

004, 1006 (D.

pproval of the bare minimum three pads for ConocoPhillips disincentivized the ability of any other oil and
Natural Resources, Division of Mining, Land and Water, “Ambler Road Project,” https://

U.S. Department of the Interior, Bureau of Land Management, Ambler Road: Environmental Impact Statement:
ttps://eplanning.blm.gov/public_projects/nepa/57323/20015364/250020506/Ambler_

er Memorandum of Understanding Between the Alaska Department

nal Park Service,” October 14, 1982: U.S. Department

of Understanding Between the Alaska Department of Fish and

sh and Wildlife Survey,”

ober 29, 2020), pp. 68668-68703.

January 27, 2023), pp. 5252-5272.

arch 13, 1982; and U.S. Department of the
ween the Alaska Department of Fish and Game, Juneau,
https://eplanning.blm.gov/public_projects/
andum_of Understanding _ BLM_and_ADFG.pdf (accessed March 16, 2023).

E. Dinerstein et al., “A Global Deal For Nature: Guiding Principles, Milestones, and Targets,” Science Advances,

Vol. 5, No. 4 (April 19, 2019), https://www.science.org/doi/10.1

Joseph R. Biden, “Tackling the C

26/sciadv.aaw2869 (accessed March 18, 2023).
imate Crisis at Home and Abroad,” Executive Order 14008, https://www.

whitehouse.gov/briefing-room/presidential-actions/2021/01/27/executive-order-on-tackling-the-climate-
crisis-at-home-and-abroad/ (accessed March 17, 2023).

— 542 —

68.

69.

70.

71.

72.

73.

74,

75.

76.

77,

78.

79.

80.

81.

82.

83.

84.

85.

86.

87.

88.

89.
90.
91.
92.

93.

2025 Presidential Transition Project

Karen Budd Falen, “Biden's ‘30 By 30 Plan’: A Slap at American Private Property Rights,” Cowboy State Daily,
April 15, 2021, httos://cowboystatedaily.com/2021/04/15/bidens-30-by-30-plan-a-slap-at-american-private-
property-rights/ (accessed March 16, 2023).

U.S. Department of the
Conservation Fund Imp
doi.gov/sites/doi.gov/fi
Ibid.

Associated Press, “Ute
October 13, 2022.
William Perry Pendley,
Review Online, Septem

US. Code § 2601.

lbid., and American Forest Resource Council v. Hammond, 422 F. Supp. 3d 184, 187 (D.D.C. 20

nterior, “Order No. 3396: Rescission of Secre
ementation by the U.S. Department of the In
es/elips/documents/so-3396-signed-2-11-21-

ndian Tribe Criticizes Biden’s Cam

“Trump Wants to Free Up Federal
ber 25, 2017, https://www.nationa
monuments-review-trump-executive-order-antiquities-act-environmentalists/ (accessed Ma
The Oregon and California Revested Lands Sustained Yie

p Hale Mon

Lands, His

terior,” February 11, 202
inal.odf (accessed March 17, 2021).

ument Designation,’ KU

nterior Secretary Fails Hi
review.com/2017/09/secretary-interior-ryan-zinke-

and Water
_ https://www.

ry’s Order 3388, ‘Land

ER 9011,
m,” National

ch 16, 2023).

d Management Act of 1937, Public Law 75-405, 43

9).

American Forest Resource Council v. Hammond, 422 F. Supp. 3d, pp. 187-188.

Federal Register, Vo
Federal Register, Vo
Federal Register, Vo

65, No.1
82, No.1

American Forest Resource Council v. Hammond, 422 F. S
he Interior, “Final Consen
solicitor/transparency/final (accessed March
Erases Litigation Website,” E&E Ne
itigation-websi
Roy Ramey, On the Origin of Specious Species (Lexington Books 2012), pp. 77-97.
am Perry Pendley, “Killing Jobs to Save t

U.S. Department of

ichael Doyle, “Interior Order
articles/interior-order-erases-
Rob
Willi
onsense,” Washington Times, May 31,

ichael Lee, “Wyoming's Push to Delis
Anti-Hunting Group,” Fox
endangered-species-list-opposition-an

Tribes Following Successful Recovery Ef
administration-returns-management-an
50 Code of Federal Regula

2012,

jobs-to-save-the-sage-grouse/ (accessed March 16, 2023).

Grizz

ews, January 21, 2
ti-hunting-group (accessed Ma
anagement and Protection o
orts,” October 29, 2020, https://\www.doi.gov/pressreleases/'
ection-gray-wolves-states-and-tribes (accessed March 18, 2023).

ews release, “Trump Administration Returns

d-pro

ions 817, and Sean

June 19, 2022, https://gaze
d0016672-ed79-
adeleine C. Bot

te.com/opin
rille

pdf (accessed March 16, 2023).
Rob Roy Ramey Il, tes

and Reclamatio:
ion’s third-

Surface Mining Contro
Pennsylvania is the na

U.S. Department of the Interior, O

arch 18, 2023).
Tim Gallaudet and Timothy R. Pet

egacy/document/2019/Oct/Fede

argest coa
Federal Register, Vol. 85, No. 207 (October 26, 2020), pp. 67631-67635.

amation and Enforcement, “Approximate Original
ov/sites/default/files/pdfs/directivel003.pdf (accessed

fice of Sur
Contour,” INE-26, June 23, 2020, https://www.osmre.g

y, “Federa
ational Oceanic and Atmospheric Administration, Oc

ion/g

imony before the Committee on Reso
https://naturalresources.house.gov/uploadedfiles/rameytesti
of 1977, Public Law 95-87.

n Act

55, No. 26 (June 26, 1990), p. 26114-26194.
4 June 13, 2000), pp. 37249-37252.
(January 18, 2017), pp. 6145-6150.

pp. 3d 184 (

6, 2023).
Ss, J

e/ (accessed March

he Sage Grouse: Junk Sci

D.D.C. 2019).
Decrees/Settlement Agreements,” https://www.doi.gov/

une 17, 2022, https://www.eenews.net/
6, 2023).

ence, Weird Science, and Plain

https://www.washington

y Bears from Endan

Paige, ““‘Rewilding’ Will
iage Just Smart Decision

rces, U.S

producer, and its state p

ace Mining Rec

Action Plan for Improvin

Water%20Availability.odf (accessed March 17, 2023).

— 543 —

roup.org/wp-content/uploads/Bottril

imes.com/news/2012/may/31/killing-

gered Species List Faces Opposition from
022, https://www.foxnews.com/politics/wyoming-delist-grizzly-

rch 18, 2023).
Gray Wolves to States and
rump-

Backfire on Colorado,” The Gazette,

uest-column-rewilding-will-backfire-on-colorado/article_
Jec-b027-abe62ba840al.html (accessed March 18, 2023).
al., “Is Conservation T
Vol. 23, No. 12 (December 2008), pp. 649-654, https://karkg

Makinge” Trends in Ecology & Evolution,

-et-al-2008.

. House of Representatives, April 8, 2014,

mony4_8.pdf (accessed March 16, 2023).

rogram was the model for SMCRA.

g Forecasts of Water Availability,”

ober 2019, https://www.noaa.gov/sites/default/files/
al%20Action%20Plan%20for%20|mproving%20Forecasts%200f%20

94.
95.

96.

97.

Mandate for Leadership: The Conservative Promise

32 U.S. Code, ch. 52.

Donald J. Trump, “Presidential Memorandum on Promoting the Reliable Supply and Delivery of Water
in the West,” October 19, 2018, https://trumpwhitehouse.archives.gov/presidential-actions/presidential-
memorandum-promoting-reliable-supply-delivery-water-west/ (accessed March 17, 2023).

U.S. Department of the Interior, “Land Buy-Back Program for Tribal Nations,” https://www.doi.gov/
buybackprogram (accessed March 18, 2023).

Great American Outdoors Act, Public Law 116-152.

— 544 —

DEPARTMENT OF JUSTICE

Gene Hamilton

he Department of Justice (DOJ) has along and noble history. That history

began with the creation of the Office of the Attorney General pursuant to

the Judiciary Act of 1789' and has continued through the creation of the
department in 1870,” the formation of the Federal Bureau of Investigation (FBD in
1908,* reforms following the terrorist attacks of September 11, 2001, and to the pres-
ent day. Properly understood within the framework of a constitutional republic
that values ordered liberty, the Department of Justice has two primary functions:
protecting public safety and defending the rule of law.

Unfortunately, the department has lost its way in recent years and has forfeited
the trust of large segments of the American people. Large swaths of the depart-
ment have been captured by an unaccountable bureaucratic managerial class and
radical Left ideologues who have embedded themselves throughout its offices and
components. The department also suffers from institutional inattentiveness to its
core functions. Instead of being perceived as possessing the utmost impartiality
and fairness as it advances the national interest on behalf of the American people—
fighting crime and defending the rule of law—the DOJ has become a department
that 46.6 percent of Americans recently indicated is, in their view, “too political,
corrupt, and not to be trusted.”*

The weight of the publicly available evidence indicates that there are many rea-
sons for this lack of trust. For example:

e The Federal Bureau of Investigation, knowing that claims of collusion
with Russia were false,° collaborated with Democratic operatives to inject

— 545 —

Mandate for Leadership: The Conservative Promise

the story into the 2016 election through strategic media leaks, falsified
Foreign Intelligence Surveillance Act (FISA) warrant applications, and lied
to Congress.°

Personnel within the FBI engaged in a campaign to convince social media
companies and the media generally that the story about the contents

of Hunter Biden’s laptop was the result of a Russian misinformation
campaign—while the FBI had possession of the laptop the entire time and
could have clarified the authenticity of the source.’

The DOJ engaged in conduct to chill the free speech rights of parents across
the United States in response to supposed “threats” against school boards,®
yet it failed to engage in any concerted campaign to protect the rights

of Americans who actually were terrorized by acts of violence like those
perpetrated against pregnancy care centers.°

The FBI tasked agents with monitoring social media and flagging content
they deemed to be “misinformation” or “disinformation” (not associated
with any plausible criminal conspiracy to deprive anyone of any rights) for
platforms to remove.'°

The FBI engaged in a domestic influence operation to pressure social media
companies to report more “foreign influence” than the FBI was actually
seeing and stop the dissemination of and censor true information directly
related to the 2020 presidential election."

The department has devoted unprecedented resources to prosecuting
American citizens for misdemeanor trespassing offenses or violations of the
FACE Act” while dismissing prosecutions against radical agents of the Left
like Antifa.”°

The department has consistently threatened that any conduct not aligning
with the liberal agenda “could” violate federal law—without actually taking
a position that the conduct in question is illegal—using the prospect of
protracted litigation and federal sanctions to chill disfavored behavior
such as with state efforts to restrict abortion” or prevent genital mutilation
of children."

The department has sued multiple states regarding their efforts to enhance
election integrity.!°

— 546 —

2025 Presidential Transition Project

e The department has failed to do its part to stop the flood of fentanyl and
other deadly drugs that are flowing across our borders and decimating
families and communities across the United States.”

e The department has abdicated its responsibility to assist in the enforcement
of our immigration laws and has engaged in wholescale abandonment of its
duty to adjudicate cases in the immigration court system.

These actions stand in stark contrast to Attorney General Merrick Garland’s
assertion before taking office that “there [must] not be one rule for Democrats and
another for Republicans, one rule for friends and another for foes.”'®

While it is true, as it is with other federal departments and agencies, that there
are committed career personnel across the department who perform their duties
faithfully and with the best intentions, this small sampling of scandals illustrates
that the DOJ has become a bloated bureaucracy with a critical core of person-
nel who are infatuated with the perpetuation of a radical liberal agenda and the
defeat of perceived political enemies. It has become a Cabinet-level department
whose leadership appears to care more about how they are perceived in the next
Politico or Washington Post article, or their stature with any number of radical
leftist organizations, than they do about justice and advancing the interests of the
American people.

It is essential that the next conservative Administration place a high priority on
reforming the DOJ and its culture to align the department with its core purposes
and advance the national interest. Critically, this must include the FBI. Anything
other than a top-to-bottom overhaul will only further erode the trust of significant
portions of the American people and harm the very fabric that holds together our
constitutional republic. At a practical level, not reforming the Department of Jus-
tice will also guarantee the failure of that conservative Administration’s agenda
in countless other ways.

Successful reform will require more than minor peripheral adjustments. It
will require a holistic, energetic, leadership-driven effort to remedy the damage
that has been done and advance the national interest. Additionally, some needed
reforms will not be possible without legislative changes from Congress. While
it is true that certain offices and components—like the FBI or the Civil Rights
Division—will require more attention than others, committed direction from the
department’s political leadership can restore the department’s focus on its two
core functions: protecting public safety and defending the rule of law.

This chapter features prominently the things the department must do to restore
its focus on these functions. Of course, there are other important reforms that do
not necessarily fit within either of those core functions, so this chapter includes
an additional section to address those areas.

— 547 -—

Mandate for Leadership: The Conservative Promise

PRIORITIZING THE PROTECTION OF PUBLIC SAFETY

Ordered liberty is at risk when our citizens lack physical safety, when career
criminals do not fear the law, when foreign cartels move narcotics and illegal
aliens into our nation at will, and when political leaders call citizens “domestic
terrorists” for exercising their constitutional rights. The Department of Justice—in
partnership with state and local partners—must recommit in both word and deed
to protecting public safety.

The overwhelming majority of crimes in the United States are properly handled
at the state and local levels,’® but the DOJ can provide critical technical support for
local law enforcement and play a critical agenda-setting role. With respect to the
Department’s core responsibilities—enforcing our immigration laws, combating
domestic and international criminal enterprises, protecting federal civil rights,
and combating foreign espionage—the federal government has primary authority
and, accordingly, accountability.

The evidence shows that the Biden Administration’s Department of Justice has
failed to protect law-abiding citizens and has ignored its most basic obligations. It
has become at once utterly unserious and dangerously politicized. Prosecution and
charging decisions are infused with racial and partisan political double standards.”
Immigration laws are ignored.”' The FBI harasses protesting parents (branded

“domestic terrorists” by some partisans) while working diligently to shut down
politically disfavored speech on the pretext of its being “misinformation” or “disin-
formation.””? A department that prosecutes FACE Act cases while ignoring dozens
of violent attacks on pregnancy care centers and/or the coordinated violation of
laws that prohibit attempts to intimidate Supreme Court Justices by parading out-
side of their homes” has clearly lost its way. A department that has twice engaged
in covert domestic election interference and propaganda operations—the Russian
collusion hoax in 2016 and the Hunter Biden laptop suppression in 2020—is a
threat to the Republic.”*

e Restoring the department’s focus on public safety and a culture of respect
for the rule of law is a gargantuan task that will involve at minimum four
overriding actions:

e Restoring the FBI’s integrity.

e Renewing the DOJ’s focus on violent crime.

e Dismantling domestic and international criminal enterprises.

e Pursuing a national security agenda aimed at external state and non-state
actors, not U.S. citizens exercising their constitutional rights.

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RESTORING THE FBI’S INTEGRITY
The FBI was founded in 1908 to “tackle national crime and security issues” when
“there was hardly any systematic way of enforcing the law across this now broad
landscape of America.”” It best serves the American people when it dedicates its
resources and energies to attacking violent crime,” criminal organizations,”’ child
predators,’ cyber-crime, and other uniquely federal interests.”

Revelations regarding the FBI’s role in the Russia hoax of 2016, Big Tech collu-
sion, and suppression of Hunter Biden’s laptop in 2020 strongly suggest that the
FBI is completely out of control. To protect the Constitution, fight crime effectively,
and protect the nation from foreign adversaries, the next conservative Adminis-
tration should begin to restore the FBI’s domestic reputation and integrity and
enhance its effectiveness in meeting actual foreign threats. To do so, the next con-
servative Administration should:

e Conduct an immediate, comprehensive review of all major active FBI
investigations and activities and terminate any that are unlawful
or contrary to the national interest.®* This is an enormous task, but it
is necessary to re-earn the American people’s trust in the FBI and its work.
To conduct this review, the department should detail attorney appointees
with criminal, national security, or homeland security backgrounds to
catalogue any questionable activities and elevate them to appropriate DOJ
leadership consistent with the new chain of command (discussed below).
The department should also consider issuing a public report of the findings
from this review as appropriate.

e Align the FBI’s placement within the department and the federal
government with its law enforcement and national security
purposes. DOJ veterans often opine that the FBI views itself as an
independent agency—accountable to no one and on par with the Attorney
General in terms of stature—but the fact remains that “[t]he Federal
Bureau of Investigation is located in the Department of Justice.”*' It is
not independent from the department (just as Immigration and Customs
Enforcement is not independent from the Department of Homeland
Security) and does not deserve to be treated as if it were.

The next conservative Administration should direct the Attorney General
to remove the FBI from the Deputy Attorney General’s direct supervision
within the department’s organizational chart and instead place it under
the general supervision of the Assistant Attorney General for the Criminal
Division and the supervision of the Assistant Attorney General for the
National Security Division, as applicable.** This can be accomplished

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through a simple internal departmental reorganization and does not need to
be approved by Congress.

Such a structure would allow the FBI to play an important role in advising
the department’s leadership on emerging threats and updating notable
investigations through daily briefings conducted with the Criminal Division
and National Security Division leadership, but it would also place the FBI
under a politically accountable leader with fewer things to manage than the
Deputy Attorney General or the Attorney General have. All notifications and
approvals that currently run to the Deputy Attorney General or the Attorney
General should be evaluated and redirected in the first instance, where
appropriate, to the relevant Assistant Attorney General.

Such a move would better align the FBI with the mission of the divisions
with which it most often interacts and emphasize the need for the areas on
which it should focus. In general, however, under no circumstances should
the FBI ever be able to go around the Attorney General or the department’s
leadership on any matter within its area of responsibility.

Prohibit the FBI from engaging, in general, in activities related

to combating the spread of so-called misinformation and
disinformation by Americans who are not tied to any plausible
criminal activity. The FBI, along with the rest of the government, needs
ahard reset on the appropriate scope of its legitimate activities. It must

not look to or rely on the past decade as precedent or legitimization for
continued action in certain spaces. This is especially true with respect to
activities that the FBI and the U.S. government writ large claim are efforts to
combat “misinformation,” “disinformation,” or “malinformation.”

The United States government and, by extension, the FBI have absolutely
no business policing speech, whether in the public square, in print, or
online. The First Amendment prohibits it. The United States is the world’s
last best hope for self-government,” and its survival relies on the ability
of our people to have healthy debate free from government intervention
and censorship. The government, through its officials, is certainly able to
speak and provide information to the public. That is a healthy component
of an informed society. But government must never manipulate the scales
and censor information that is potentially harmful to it or its political
leadership. This is the way of totalitarian dictatorships, not of free
constitutional republics.

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The DOJ needs a hard firewall between its legitimate activities (monitoring
online activity for potential threats in its mission space, looking at social
media profiles for evidence of intent or other criminal activity, etc.) and
those in which it must not engage (asking or demanding public forums or
publishers to remove material based on the content and/or viewpoints
expressed or itself censoring speech).

Streamline the non-law enforcement functions within the FBI, such
as its Office of General Counsel, and obtain those services from other
offices within the department. The next conservative Administration
should eliminate any offices within the FBI that it has the power to
eliminate without any action from Congress.** For example, few Americans
know that the FBI maintains a core of approximately 300 attorneys within
its Office of General Counsel, an office that has been involved in some of the
FBI’s most damaging recent scandals.*° These attorneys are not necessary
to the functioning of the FBI in their current capacity. Legal advice should
come from attorneys at the DOJ, whether those attorneys are within the
Criminal Division, the National Security Division, the Justice Management
Division, or the Office of Legal Counsel. Moving legal review outside the FBI
would serve as a crucial check on an agency that has recently pushed past
legal boundary after legal boundary. Similarly, the FBI does not need its own
Office of Congressional Affairs separate and apart from the DOJ Office of
Legislative Affairs, nor does it need its own Office of Public Affairs.

Emphasize, fund, and reward field offices while shrinking
headquarters staff. While the FBI has essential headquarters functions
that must be fulfilled and should likely be fulfilled by a team in Washington,
D.C., the next conservative Administration should make a priority of
deploying, funding, and rewarding the work of the field offices to the
greatest extent possible. The Department of Justice must value badges over
bureaucracy, must rethink its internal reporting structures, and should aim
to realign the FBI’s resources accordingly.

Submit a legislative proposal to Congress to eliminate the 10-year
term for the Director. After J. Edgar Hoover’s decades-long term as FBI
Director came to an end following his death in 1972, and in light of oversight
conducted by Congress into alleged Intelligence Community and FBI
abuses in the 1970s, Congress limited the Director’s tenure to one “ten-
year term.”*° The realities of the FBI’s abuses and overreach in recent years
demonstrate that further reform is still necessary.

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The Director of the FBI must remain politically accountable to the
President in the same manner as the head of any other federal department
or agency. To ensure prompt political accountability and to rein in perceived
or actual abuses, the next conservative Administration should seek a
legislative change to align the FBI Director’s position with those of the
heads of all other major departments and agencies.

RENEWING THE DEPARTMENT’S FOCUS ON VIOLENT CRIME

Despite the DOJ’s pronouncements that violent crime continues to be a top pri-
ority, it has increased across the United States. The department’s leadership must
make actually reducing violent crime a priority across the United States—and it
must do so in partnership with state and local officials in a manner that is tailored
to the needs and conditions in those states and localities.

Targeting Violent and Career Criminals, Not Parents. The next conserva-
tive Administration must ensure that the Department of Justice devotes significant
effort to reducing violent crime nationwide. The Attorney General should require
all U.S. Attorneys to develop a jurisdictional-specific plan—whenever possible in
coordination with state and local law enforcement—to reduce violent crime within
each of their districts. Then the Attorney General should hold each U.S. Attorney
accountable for achieving actual results.

In recent years, federal and state officials have succumbed to calls from
anti-law enforcement advocates for so-called criminal justice reform. The pleas-
ant-sounding terminology of reform masks the darker reality of this movement,
which is one that has supported dismantling effective federal, state, and local
law enforcement and stripped away some of the most fundamental tools that law
enforcement has long had at its disposal. This campaign is not just ill-advised; it
has clearly had real-world consequences in the form of catastrophic increases in
crime—particularly violent crime—nationwide. As discussed in the next section,
the Department of Justice has a special obligation to restore law and order in
such districts.*’

Juxtaposed against this increase in violent crime are things like Attorney Gen-
eral Merrick Garland’s October 4, 2021, memorandum directing the commitment
of significant resources and energies to combating imaginary, politically conve-
nient threats of violence toward members of school boards and their staffs during
the heat of the Virginia gubernatorial race.** There was no similar effort to inves-
tigate elected officials and other public officers who conspired with outside allies
to target and harass parents who were merely exercising their constitutional and
statutory rights.*° If we are to continue to have informed and civil dialogue in the
United States on issues of public concern, the DOJ must enforce applicable civil
rights laws in an even-handed way when citizens’ livelihoods are threatened merely
because they have exercised their rights.

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Enhancing the Federal Focus on and Resources in Jurisdictions with
Rule-of-Law Deficiencies. A disturbing number of state and local jurisdictions
have enacted policies that directly undermine public safety, leave doubt about
whether criminals will be punished, and weaken the rule of law. While the prose-
cution of criminal offenses in most jurisdictions across the country must remain
the responsibility of state and local governments, the federal government owes a
special responsibility to Americans in jurisdictions where state and local prose-
cutors have abdicated this duty.*°

Jurisdictions suffering from deficiencies in the rule of law warrant, as appropri-
ate within our federal system, greater attention and additional federal resources
that are sufficient to protect the rights of American citizens and federal interests.
In the next conservative Administration, the DOJ, acting primarily through its U.S.
Attorneys, should therefore:

e Use applicable federal laws to bring federal charges against
criminals when local jurisdictions wrongfully allow them to evade
responsibility for their conduct." The department should also increase
the federal law enforcement presence in such jurisdictions and explore
innovative solutions to bring meaningful charges against criminals and
criminal organizations in such jurisdictions.

e Where warranted and proper under federal law, initiate legal action
against local officials—including District Attorneys—who deny
American citizens the “equal protection of the laws” by refusing to
prosecute criminal offenses in their jurisdictions. This holds true
particularly for jurisdictions that refuse to enforce the law against criminals
based on the Left’s favored defining characteristics of the would-be offender
(race, so-called gender identity, sexual orientation, etc.) or other political
considerations (e.g., immigration status).

e Pursue policies and legislation that encourage prosecution of
violent crimes as well as appropriate sentences for such offenses.
The Biden Administration has adopted policies that do not prevent armed
career criminals, who actually commit violent crimes, from committing
those crimes. A recent U.S. Sentencing Commission report shows that
armed career criminals are consistently sentenced below their minimum
sentencing guidelines range.”

There are valid reasons for sentence reductions in particular cases (for

example, if the defendant has provided substantial assistance in prosecuting
other offenders). At the same time, the DOJ must ensure that its line

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Mandate for Leadership: The Conservative Promise

attorneys are consistently using the tools at their disposal in cases with
violent offenders, including pursuing mandatory minimum sentences under
the Armed Career Criminal Act (ACCA).** The department should also
support legislative efforts to provide further tools, such as the Restoring the
Armed Career Criminal Act, which Senators Tom Cotton (R-AR), Marsha
Blackburn (R-TN), and Cindy Hyde-Smith (R-MS) introduced in 2021 in
response to U.S. Supreme Court decisions neutering the ACCA.*

e Enforce the death penalty where appropriate and applicable. Capital
punishment is a sensitive matter, as it should be, but the current crime
wave makes deterrence vital at the federal, state, and local levels. However,
providing this punishment without ever enforcing it provides justice neither
for the victims’ families nor for the defendant. The next conservative
Administration should therefore do everything possible to obtain finality for
the 44 prisoners currently on federal death row. It should also pursue the
death penalty for applicable crimes—particularly heinous crimes involving
violence and sexual abuse of children—until Congress says otherwise
through legislation.*

DISMANTLING DOMESTIC AND INTERNATIONAL
CRIMINAL ENTERPRISES

Criminal organizations are as old as crime itself, but are more extensive,
sophisticated, and dangerous today than at any other point in history. The
Department of Justice has a key role in tackling transnational criminal orga-
nizations like Mara Salvatrucha (MS-13) and Mexican drug cartels as well as
purely domestic criminal organizations like those built on the more traditional
mafia crime model as part of its obligation to ensure the safety and security of
the American people.

The department’s primary directive under the next Administration should be
to return to an unapologetic focus on dismantling these criminal organizations
and incarcerating their membership. Once this reprioritization occurs, the depart-
ment’s political leadership should take concrete steps to use agency reach and
resources to prevent these criminal organizations from operating and surviving.
Assaulting the business model of these criminal organizations—which are massive,
diversified enterprises with nationwide or international operations—is essential
for success. The next Administration will therefore need to:

e Revitalize the DOJ’s use of the array of statutory tools that exist for

dealing with the threat of criminal organizations. The most potent
ones are the simplest. For example, the department should:

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1. Rigorously prosecute as much interstate drug activity as possible,
including simple possession of distributable quantities.*° Recent efforts
to create the impression that drug possession crimes are not serious
offenses has contributed to the explosion of criminal organization
activities in the United States.

2. Aggressively deploy the Racketeer Influenced and Corrupt
Organizations Act (RICO),*” which Congress expressly created to
empower the Department of Justice to treat patterns of intrastate-
level crimes, such as robbery, extortion, and murder, as federal
criminal conduct for criminal organizations and networks. The next
Administration can use existing tools while it works with Congress to
develop new tools.

Secure the border,** which is the key entry point for many criminal
organizations and their supplies, products, and employees. Mexico—
which is arguably functioning as a failed state run by drug cartels—is

the main point of transit for illegal drugs produced in Central and South
America, fentanyl precursors from the Chinese Communist Party-led
People’s Republic of China,” weapons, human smuggling and trafficking,
and other contraband. Mexican drug cartels, including the dominant
Sinaloa Cartel and the Jalisco New Generation Cartel (CJNG), are the main
drivers of fentanyl production and distribution in the United States. The
southwestern land border is sufficiently porous that Mexican drug cartels
have operational control of large sections of the border, which facilitates
easy movement of product and personnel. These cartels are also violent and
not afraid to demonstrate force on both sides of the border. Their conduct
represents a clear and present danger to the United States and its citizens.

In addition to finalizing the southwestern land border wall, the next
Administration should take a creative and aggressive approach to tackling
these dangerous criminal organizations at the border. This could include
use of active-duty military personnel and National Guardsmen to assist

in arrest operations along the border—something that has not yet been
done. A new and forceful approach to interdiction will have a ripple effect

on the operations of these criminal organizations, which currently operate
freely without concern for criminal prosecution, and will lay the necessary
groundwork for initial prosecutions of these organizations and their leaders.

It is critical that the federal government staunch the flow of drugs by
preventing the far-too-easy access to the United States that now exists.

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There can be no serious dispute that the Biden Administration has opened
the southwest border to whomever wants to enter and that some of those
entrants are smuggling fentanyl] into the country. More than 100,000
Americans died in a one-year period from opioid overdoses, and many of
them died specifically from having used fentanyl.*° The federal government
should treat this problem as aggressively as necessary. Enforcing the
customs and immigration laws is a matter of life and death.

PURSUING A NATIONAL SECURITY AGENDA AIMED AT
EXTERNAL STATE AND NON-STATE ACTORS, NOT U.S.
CITIZENS EXERCISING THEIR CONSTITUTIONAL RIGHTS

The Department of Justice plays a vital role in protecting our national security,
and it must not refrain from engaging in public initiatives that identify our adver-
saries and educate the American people about their activities.

The DOJ’s China Initiative under President Trump reflected the department’s
priority of combating Chinese threats to our national security.*! Because China
was accountable for approximately 80 percent of all prosecutions for economic
espionage and approximately 60 percent of all thefts of trade secrets, then-At-
torney General Jeff Sessions set key goals for the China Initiative that included
development of an enforcement strategy concerning researchers in labs and
universities who were being coopted into stealing critical U.S. technologies, iden-
tification of opportunities to address supply-chain threats more effectively, and
education of colleges and universities about potential threats from Chinese influ-
ence efforts on campus.

In February 2022, the Biden Administration terminated the department’s China
Initiative largely out of a concern for poor “optics.”°? While the Biden Administra-
tion correctly identified China as America’s “only competitor with both the intent
to reshape the international order and, increasingly, the economic, diplomatic,
military, and technological power to do it,”** it folded in the face of political cor-
rectness and sent the message that liberal sensitivities outweighed bringing justice
to threats from China. The next conservative Administration should therefore:

e Restart the China Initiative.

e Pursue other programs to educate the American people about the
real and dangerous threats to our national security and economic
security that are posed by actors across the globe, most notably
China and Iran.

e Ensure that it is agile enough to devote sufficient resources and

attention to other emerging threats that involve federal interests

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such as increases in “sextortion,” ransomware, and the continued
proliferation of child pornography.

DEFENDING THE RULE OF LAW

The DOJ’s actions over the course of the Biden Administration exhibit scorn for
its stated mission: “to uphold the rule of law, to keep our country safe, and to pro-
tect civil rights.”>* The Biden Administration’s unprecedented politicization and
weaponization of the department therefore demand a comprehensive response
from the next Administration.

Restoration of the department’s values of independence, impartiality, honesty,
integrity, respect, and excellence must serve as first principles for its efforts on all
fronts. Concretely, the DOJ must identify and address all individuals, policies, and
directives that have fueled the destruction of these core values and the American
people’s loss of trust in the department and its officials. The next Administration
will need to exert significant energy to dismantle the two-tiered system of justice
currently in place at the department while simultaneously applying the rule of law
evenly and with neutrality.

Specific examples of department corruption, such as the Russia collusion
hoax, will need to be tackled, exposed, and addressed head-on. This will require
notjust winning in a court of law, but also demonstrating culpability to the public
and the media in a concrete and nonrefutable manner. These efforts will require
commitment and willpower, but they will be essential to restoring the trust of the
American people.

Promptly and Properly Eliminating Lawless Policies, Investigations, and
Cases, Including All Existing Consent Decrees. Few things undermine the
DOJ’s credibility more than brazenly partisan and ideologically driven prosecution
of an Administration’s perceived political enemies, yet the department has readily
indulged in such misadventures during the Biden Administration. Before even
entering the Robert F. Kennedy building on January 20, 2025, the next Adminis-
tration should:

e Conduct a thorough review of all publicly available policies,
investigations, and cases.

e Inamanner consistent with applicable law, prepare a plan to end
immediately any policies, investigations, or cases that run contrary
to law or Administration policies.

e Ensure that upon the next President’s inauguration, appointees at

the department obtain information about anything that was not
learned before taking office and conduct the same analysis.

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An egregious example of the need for such a review is provided by the depart-
ment’s use of the Freedom of Access to Clinic Entrances (FACE) Act® to harass
pro-life demonstrators while not pursuing similar investigations of shocking acts
of violence committed against pro-life pregnancy resource centers. On the morning
of September 23, 2022, pro-life activist Mark Houck was arrested by more than
15 FBI agents at his home in Pennsylvania in front of his wife and small children.
Agents came to his door with guns drawn to arrest the 48-year-old father of seven
whose alleged crime involved a minor altercation with an activist who was harass-
ing one of his children in front of an abortion clinic almost one year before Mr.
Houck’s arrest by the FBI.*° Similarly, Paul Vaughn, a 55-year-old father of 11, was
arrested at his home in Mt. Juliet, Tennessee, by armed FBI agents for allegedly
participating in a peaceful protest at an abortion clinic one year earlier.*”

These arrests stand in stark contrast to the department’s virtual silence on the
wave of vandalism and violence directed at religiously affiliated institutions, includ-
ing pregnancy resource centers, following the Supreme Court’s decision in Dobbs
v. Jackson Women’s Health Organization.** The Catholic News Agency reported
more than one hundred such incidents as of September 2022.°°

By engaging in disparate and viewpoint-based enforcement of an already con-
troversial law like the FACE Act against pro-life activists, the DOJ has needlessly
undermined its credibility with law-abiding people of faith. The department should
make every effort to uphold equal protection of the law and avoid politically moti-
vated and viewpoint-based prosecutions. Specifically, it should:

e Ensure that its review extends beyond ending the absurd double
standards embodied in the ongoing campaign of FACE Act
prosecutions and instead be a thorough and holistic review of all DOJ
activities, including all consent degrees and settlement agreements
currently in force.

e Seek to terminate any unnecessary or outdated consent decree to
which the United States is a party.

e Consider pursuing intervention in other matters where consent
decrees or settlement agreements continue to bind parties years or

decades after the fact.

e Asits review concludes, and consistent with applicable law, take
appropriate action in all cases, including those on appeal.

e Enact policies and regulations that prohibit settlement payments to
third parties.

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Engaging in Zealous Advocacy for and Defense of the Constitution and
Lawful Administration Regulations and Policies. The Department of Jus-
tice has the exclusive responsibility for the “conduct of litigation in which the
United States, an agency, or officer thereof” is involved and has been charged
with the supervision of “all litigation to which the United States, an agency, or
officer thereof is a party.”*' However, in politically contentious cases, Assistant
United States Attorneys and other line prosecutors during conservative Admin-
istrations seek to influence outcomes of cases not because of any legal deficiency
in the case or policy being defended, but by refusing to take certain positions, by
writing public letters of protest, and by engaging in faux resignations from certain
internal appointments. This can cause the department to take positions that are
inconsistent with the interests of the President and his appointees in other places
throughout the Administration.

While the supervision of litigation is a DOJ responsibility, the department falls
under the direct supervision and control of the President of the United States as a
component of the executive branch. Thus, and putting aside criminal prosecutions
that can warrant different treatment, litigation decisions must be made consistent
with the President’s agenda. This can force line attorneys to take uncomfortable
positions in civil cases because those positions are more closely aligned with the
President’s policy agenda.

Ultimately, the department will have to make tough calls as it manages its litiga-
tion, but those calls must always be consistent with the President’s policy agenda
and the rule of law. A line attorney should never either directly or indirectly pursue
a policy agenda through litigation that is inconsistent with the agenda of his or her
client agency or the President. The department should also be cognizant of any
attempts to slow litigation and outlast the Administration to avoid finality. The
next conservative Administration should therefore:

e Issue guidance to ensure that litigation decisions are consistent with
the President’s agenda and the rule of law.

e Ensure that, consistent with this principle, the department’s
leadership is prepared to impose appropriate disciplinary action as
circumstances arise.

Affirming the Separation of Powers. Federal courts have jurisdiction to deal
with a wide array of issues in law and equity in the United States. The increas-
ingly aggressive posture of federal courts does not change one constitutionally
immutable fact: All three branches of the federal government retain not just the
right, but the obligation to assess constitutionality. It is this obligation that is the
foundation of the separation of powers.

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The next conservative Administration should embrace the Constitution and
understand the obligation of the executive branch to use its independent resources
and authorities to restrain the excesses of both the legislative and judicial branches.
This will mean ensuring that the leadership of the Department of Justice and its
components understand the separation of powers, that pushback among the
branches is a positive feature and not a defect of our system, and that the federal
system is strengthened, not weakened, by disagreement among the branches.

One example includes potentially seeking the overruling of Humphrey’s Exec-
utor v. United States. This case approved so-called independent agencies whose
directors are not removable by the President at will. The Supreme Court has
chipped away at Humphrey’s Executor in cases like Seila Law v. Consumer Financial
Protection Bureau, but the precedent remains. The next conservative Adminis-
tration should formally take the position that Humphrey’s Executor violates the
Constitution’s separation of powers.

Zealously Guarding Other Constitutional Protections. The next conserva-
tive Administration must ensure that the DOJ zealously guards the constitutional
rights of all Americans in all that it does. This extends not only to rights implicated
in the department’s criminal activities, but to all rights enjoyed by the American
people—such as the First Amendment. The department should reject any invi-
tation to limit these fundamental promises based on the political ideology of the
speech at issue.

Arecent Supreme Court case illustrates the problems that arise when the DOJ
takes a cramped interpretation of the First Amendment in service of a political
ideology. In 303 Creative LLC v. Elenis, the department argued in favor of the
government’s ability to coerce and compel what the lower courts all found to be
pure speech.™ The oral argument made clear the department’s view that it was
the viewpoint expressed that gave the government power to censor and compel
speech. During oral argument, the United States took the remarkable position
that government can compel a Christian website designer to imagine, create, and
publish a custom website celebrating same-sex marriage but cannot compel an
LGBT person to design a similar website celebrating opposite-sex marriage.® In
the government’s view, declining to create the latter website was based on an objec-
tion to the message, while the former was based on status rather than message,
but this argument inevitably turns on the viewpoint expressed. It means that the
government gets to decide which viewpoints are protected and which are not—a
frightening and blatantly unconstitutional proposition.

Just as troubling, the government’s arguments against free speech are not lim-
ited to the facts of 303 Creative. As Colorado admitted to the lower courts, all sorts
of artists and speakers like speechwriters, photographers, and videographers can be
compelled to design custom messages that violate their most fundamental convic-
tions as long as it serves a certain viewpoint that the government wants to promote.

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In fact, it was only a few years ago, in Masterpiece Cakeshop, that the govern-
ment acknowledged the constitutional problems involved in compelling artists
to speak government-favored messages. In that case, the United States acknowl-
edged “a basic First Amendment principle that ‘freedom of speech prohibits the
government from telling people what they must say.’””°° The department had it
right when it argued that the government may not “compel the dissemination of
its own preferred message,” because the First Amendment protects the “individual
freedom of mind.”®’ It was also correct when it argued that “[a]n artist cannot be
forced to paint, a musician cannot be forced to play, and a poet cannot be forced
to write.”°* The United States’ directly contrary position in 303 Creative is hard
to explain based on anything other than its support for the message the State of
Colorado was attempting to compel.

It is black letter law that no official “can prescribe what shall be orthodox...or
force citizens to confess by word or act their faith therein.” Rather, the First
Amendment places “the decision as to what views shall be voiced largely into the
hands of each of us, in the hope that use of such freedom will ultimately produce a
more capable citizenry and more perfect polity.””° As the Supreme Court has noted,
government officials have frequently sought to “coerce uniformity of sentiment
in support of some end thought essential to their time and country.”” In the face
of such attempts to coerce orthodoxy, the DOJ should maintain its commitment
to upholding the Constitution’s neutral principles of free speech, which commit
the government “to preserve an uninhibited marketplace of ideas in which truth
will ultimately prevail.””

Pursuing Equal Protection for All Americans by Vigorously Enforcing
Applicable Federal Civil Rights Laws in Government, Education, and the
Private Sector. Entities across the private and public sectors in the United States
have been besieged in recent years by an unholy alliance of special interests, rad-
icals in government, and the far Left. This unholy alliance speaks in platitudes
about advancing the interests of certain segments of American society, but that
advancement comes at the expense of other Americans and in nearly all cases vio-
lates long-standing federal law.

Even though numerous federal laws prohibit discrimination based on notable
immutable characteristics such as race and sex,” the Biden Administration—
through the DOJ’s Civil Rights Division and other federal entities—has enshrined
affirmative discrimination in all aspects of its operations under the guise of “equity.”
Federal agencies and their components have established so-called diversity, equity,
and inclusion (DED) offices that have become the vehicles for this unlawful discrim-
ination, and all departments and agencies have created “equity” plans to carry out
these invidious schemes.” To reverse this trend, the next conservative Adminis-
tration should:

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e Ensure that the DOJ spearheads an initiative demonstrating the
federal government’s commitment to nondiscrimination. The
department should also lead a whole-of-government recommitment to
nondiscrimination and should be working with all other federal agencies,
boards, and commissions to ensure that they are both complying with
constitutional and legal requirements and using their authorities and
funding to prevent discrimination not only internally, but also at the
state, local, and private-sector levels. This will require particularly close
coordination with several key agencies, including such obvious candidates
as the Equal Employment Opportunity Commission; the Departments
of Defense, Education, and Housing and Urban Development; and the
Securities and Exchange Commission. It will also require enforcing
contractual requirements that prohibit discrimination on federal
contractors.

e Reorganize and refocus the DOJ’s Civil Rights Division to serve as the
vanguard for this return to lawfulness. The Attorney General and other
DOJ political leadership should provide the resources and moral support
needed for these efforts. The Civil Rights Division should spend its first year
under the next Administration using the full force of federal prosecutorial
resources to investigate and prosecute all state and local governments,
institutions of higher education, corporations, and any other private
employers who are engaged in discrimination in violation of constitutional
and legal requirements.

Announcing a Campaign to Enforce the Criminal Prohibitions in 18 U.S.
Code §§ 1461 and 1462 Against Providers and Distributors of Abortion Pills
That Use the Mail. Federal law prohibits mailing “[e]very article, instrument,
substance, drug, medicine, or thing which is advertised or described in a manner
calculated to lead another to use or apply it for producing abortion.””° Following
the Supreme Court’s decision in Dobbs, there is now no federal prohibition on the
enforcement of this statute. The Department of Justice in the next conservative
Administration should therefore announce its intent to enforce federal law against
providers and distributors of such pills.

Reassigning Responsibility for Prosecuting Election-Related Offenses
from the Civil Rights Division to the Criminal Division. The Attorney Gen-
eral in the next conservative Administration should reassign responsibility for
prosecuting violations of 18 U.S. Code § 241” from the Civil Rights Division to
the Criminal Division where it belongs. Otherwise, voter registration fraud and
unlawful ballot correction will remain federal election offenses that are never
appropriately investigated and prosecuted.”

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Voter fraud includes unlawful practices concerning voter registration and ballot
correction. When state legislatures are silent as to procedures for absentee ballot
curing or provide specific rules governing that curing, neither counties nor courts
may create a cure right where one does not exist, may not modify the law on curing,
and certainly cannot engage in creating consent orders with the force of law that
are inconsistent with the orders of other similarly situated counties.

The DOJ has ceded substantial discretion concerning voter suppression to
the Civil Rights Division. Since the Bush Administration, DOJ leadership has
determined that using the Election Crimes Branch to prosecute fraudulent voter
registration, including mail-in ballot fraud, was too politically costly.”* The Crim-
inal Division’s Federal Prosecution of Election Offenses handbook advised that
schemes that violated equal protection constituted “voter suppression” prosecut-
able under 18 U.S. Code § 241 as part of the guidelines for which the department’s
criminal prosecutors were trained.” State-based investigations of election crimes
are supposed to be referred to the Public Integrity Section for review. Historically,
18 U.S. Code § 241 (conspiracy against rights) was used as a basis for investigating
state officials whose statements or orders violated the equal protection rights of
voters or deliberately misinformed voters concerning the eligibility of their ballots.

Nevertheless, the Department of Justice has formalized the Civil Rights Divi-
sion’s (as opposed to the Criminal Division’s) jurisdiction over 18 U.S. Code § 241
investigations and prosecutions. The Criminal Division is no longer involved in
consultation or review of 18 U.S. Code § 241 investigations.®° The Criminal Division
has accordingly advised states that “[i]n the case of a crime of violence or intimida-
tion,” they should “call 911 immediately and before contacting federal authorities”
because “[s]tate and local police have primary jurisdiction over polling places,”*!
despite clearly applicable federal law.

This is a mistake. With respect to the 2020 presidential election, there were no
DOJ investigations of the appropriateness or lawfulness of state election guidance.
Consider the state of Pennsylvania. The Secretary of State sent guidance to the
counties stating that:

This revised guidance addresses the issuance, voting and examination

of provisional ballots under the Election Code. Provisional ballots were
originally mandated by section 302 of the Help America Vote Act of 2002
(HAVA). Provisional ballot amendments included in Act 77 of 2019 went into
effect for the 2020 Primary election. Provisional ballot amendments included
in Act 12 of 2020 go into effect for the first time on November 3, 2020.°?

HAVA, however, mandates provisional ballots only for eligible voters who were

not on a state’s voter registration list.*? It does not apply to those who registered
for mail-in voting but whose ballots were rejected due to some form of spoliation.

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Pennsylvania Act 12 (amended in 2020) does not authorize curing by providing
provisional ballots for mail-in voters whose ballots were rejected. Act 12 requires,
as part of the mail-in application process, an affidavit that:

[The elector] shall not be eligible to vote at a polling place on election day
unless the elector brings the elector’s mail-in ballot to the elector’s polling
place, remits the ballot and the envelope containing the declaration of the
elector to the judge of elections to be spoiled and signs a statement subject
to the penalties under 18 Pa.C.S. § 4904 (relating to unsworn falsification to
authorities) to the same effect.**

The law in Pennsylvania clearly states that no county may affirmatively provide
provisional ballots: The mail-in voter must vote in person and sign a new affidavit.
In the 2020 election, the Pennsylvania Supreme Court recognized that “the Election
Code contains no requirement that voters whose ballots are deemed inadequately
verified be apprised of this fact. Thus, unlike in-person voters, mail-in or absentee
voters are not provided any opportunity to cure perceived defects in a timely man-
ner.”*° Given the Pennsylvania Secretary of State’s use of guidance to circumvent
state law, the Pennsylvania Secretary of State should have been (and still should be)
investigated and prosecuted for potential violations of 18 U.S. Code § 241.

Investigations and prosecutions under 18 U.S. Code § 241 are currently within
the jurisdictional oversight of the Civil Rights Division, not the Criminal Division.
Only by moving authority for 18 U.S. Code § 241 investigations and prosecutions
back to the Criminal Division will the rule of law be appropriately enforced.

Rejecting Third-Party Requests for Politically Motivated Investigations
or Prosecutions. The DOJ should reject demands from third-party groups that
ask it to threaten politically motivated investigation or prosecution of those engag-
ing in lawful and, in many cases, constitutionally protected activity. By acceding to
such demands, the department risks diminishing its credibility with the American
public. This risk is exacerbated by the fact that communications between govern-
ment officials and third-party groups are generally unprotected by privilege and
subject to disclosure, whether via subpoena to the third-party group or via request
made pursuant to the Freedom of Information Act. These communications can
even be made public voluntarily by the third-party group.

Arecent example illustrates the risks posed by such activity. On October 4, 2021,
Attorney General Merrick Garland issued a memorandum to the Director of the
FBI, the Executive Office for U.S. Attorneys, and the Assistant Attorney General,
Criminal Division, calling on the FBI to work with each U.S. Attorney to “con-
vene meetings with federal, state, local, Tribal, and territorial leaders” to discuss
strategies for addressing “threats against school administrators, board members,
teachers, and staff.”®” Subsequent reporting and investigation revealed that the

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memorandum was prompted by a September 29, 2021, letter sent by the National
School Boards Association (NSBA) to President Biden demanding a federal law
enforcement response to perceived threats to school board members and pub-
lic-school employees.

The NSBA letter made outlandish demands in response to protests that were
then occurring at school board meetings in response to COVID policies and revela-
tions about the use of critical race theory-infused curricula in classrooms. Among
the letter’s demands was a call for a federal investigation into parents’ actions (“hei-
nous actions” that “could be the equivalent to a form of domestic terrorism and
hate crimes”) under a variety of federal laws including the “Gun-Free Zones Act,
the PATRIOT Act in regards to domestic terrorism, the Matthew Shepard and
James Byrd Jr. Hate Crimes and Prevention Act, the Violent Interference with
Federally Protected Rights statute, and the Conspiracy Against Rights statute”
and “an Executive Order to enforce all applicable federal laws for the protection
of students and public school district personnel, and any related measure.

Both the Attorney General’s memorandum and the NSBA letter drew swift
public condemnation, including from 14 sitting state Attorneys General.®? A sub-

288

sequent internal investigation commissioned by the NSBA revealed that officials
at the White House had been in discussions with NSBA officials about the contents
of the letter weeks before it was issued. The investigation also revealed that White
House officials indicated they planned to raise the contents of the draft letter with
DOJ officials a full week before the NSBA’s letter was issued.®°

This cooperation by a third-party group, the White House, and the DOJ to craft
and coordinate a response to an ill-advised and politically motivated letter under-
mines the department’s credibility as an impartial law enforcement agency. In the
words of the 14 state Attorneys General who wrote to oppose the department’s
memorandum, “potential collusion between the White House, the Department,
and the NSBA in the actual creation of the September 29 letter—as a pretext for
threats against parents—raises serious concerns.”*!

The DOJ should carefully scrutinize all requests for law enforcement assis-
tance and reject requests by third parties to engage in political grandstanding that
ignores the department’s traditional jurisdictional limits and that would trample
politically controversial but constitutionally protected activity.

Ensuring Proper Distribution of DOJ Grant Funds. DOJ grants are an
underutilized asset in most conservative Administrations. When used properly,
they can be highly effective in implementing the President’s priorities. The Office
of Justice Programs (OJP) is comprised of six components and is responsible for
most DOJ grants to local law enforcement, juvenile justice, and victims of crime
as well as for criminal justice research and statistics. The opportunity to support
a President’s agenda may be greater through OJP grant funding than it is through
any of the federal government’s other grant-making components.

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Consistent with appropriations from Congress, the OJP dispenses approxi-
mately $7 billion in various grants. Block grants are given to a state to be awarded
pursuant to federal regulations. Some funds to support law enforcement and
victims of crime are awarded pursuant to block grants. But most OJP funds are
awarded through discretionary grants—specific programs written into the budget
by Congress.

Although Congress dictates the way in which many grant awards are to be
made, federal staff enjoy a tremendous amount of discretion in adding “conditions”
and “priority points.” Grants operate with a carrot and a stick. To receive grant
funding, a recipient must agree to certain conditions, which in many instances
include the President’s priorities. For instance, under an anti-human trafficking
grant during the Obama Administration (approximately $110 million in 2020), an
awardee had to show a partnership with an LGBTQ organization and always have
an interpreter on site. These conditions worked to change culture and overlayed
President Obama’s priorities: support for the LGBTQ community and for more of
the funding to go to areas with large immigrant populations.

During the Trump Administration, a condition added to grants stated that an
awardee had to comply with all federal law (stock language), including federal law
regarding the exchange of information between federal and local authorities about
an individual’s immigration status. This condition prevented law enforcement
in “sanctuary cities” from receiving grant awards. While the Trump Administra-
tion suffered a series of setbacks from several hostile courts, it obtained from the
Second Circuit Court of Appeals a decision upholding the department’s authority
to impose these conditions.”

To ensure that taxpayer-funded grants are prioritized and distributed properly,
the next conservative Administration should:

e Conduct an immediate, comprehensive review of all federal grant
disbursals to ensure not only that the programs are being properly
administered by the department, but also that the grant funding is
being received and used properly by recipients.

e Order an overhaul of the DOJ grant application process, to include
more rigorous vetting of state, local, and private grant applicants and
inclusion of more pre-application criteria to ensure baseline fitness
and eligibility for federal grant dollars. This long-overdue enhancement
of the grant application and issuance process will ensure that hard-earned
taxpayer dollars are going only to lawful actors who support federal law
enforcement and demonstrate the ability and willingness to engage in
lawful activities.

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Ensuring Proper Enforcement and Administration of Our Immigration
Laws. Although its role has changed over the years, most notably following the
passage of the Homeland Security Act of 2002,°* the Department of Justice plays
a crucial role in the enforcement and adjudication of our immigration laws.” Its
leadership and energy, however, have not always reflected the importance placed
by Congress on the execution of that crucial mission. With a few notable exceptions,
successful fulfillment of the department’s responsibilities with respect to immi-
gration was largely neglected until the Trump Administration. The Department
of Homeland Security may be the largest federal department with immigration
responsibilities, but successful fulfillment of the responsibilities prescribed by
the immigration laws is not possible without bold and dedicated action by the
Department of Justice.

The DOJ and its leadership must intentionally prioritize fulfillment of the
department’s immigration-related responsibilities in the next conservative Admin-
istration. This will be no small task, as these responsibilities play out across nearly
every DOJ office and component. If they hope to fulfill their responsibilities as
assigned by Congress and deliver results for the American people, the department
and the Attorney General should:

e Issue guidance to all U.S. Attorneys emphasizing the importance
of prosecuting immigration offenses,” and immigration-related
offenses. The brunt of these offenses is born by districts along the
southwestern border with Mexico, but the simple fact remains that
immigration and immigration-related offenses are present in every
district across the country. Successfully pursuing the priorities outlined
in this chapter will require creative use of the various immigration and
immigration-related authorities in close partnership with the Department
of Homeland Security, the Department of State, and other appropriate
federal entities depending on the situation.

e Pursue appropriate steps to assist the Department of Homeland
Security in obtaining information about criminal aliens in
jurisdictions across the United States, particularly those inside
“sanctuary” jurisdictions.

e Examine and consider the appropriateness of withdrawing or
overturning every immigration decision rendered by Attorney
General Garland (and any successor Attorney General during
President Biden’s term). The Attorney General should pick up where the
Attorneys General under President Trump left off and exercise his or her
authority to adjudicate cases and provide guidance in appropriate cases to

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Mandate for Leadership: The Conservative Promise

correct erroneous decisions, provide clarity, and align Executive Office for
Immigration Review (EOIR) decisions with the law.

At a minimum, pursue through rulemaking—and in partnership
with the Department of Homeland Security where appropriate—the
promulgation of every rule related to immigration that was issued
during the Trump Administration. Such rulemakings include guidance
on continuances in immigration court cases, eligibility for asylum, and
other related matters. However, the DOJ should not stop there: It should
continually evaluate its authorities and operational reality within the
immigration court system and promulgate regulations accordingly.

Commit sufficient resources to the adjudication of cases in the
immigration court system in different environments (for example, in
the context of the Migrant Protection Protocols).

Pursue proactive litigation to advance the federal government’s
interests in areas where erroneous precedent curtails authorities
provided by Congress (for example, by pursuing the overturning of
the Flores Settlement Agreement).

Pursue aggressive enforcement of the immigration laws within the
Immigrant and Employee Rights Section of the Civil Rights Division
to ensure that no American citizen is discriminated against in the
employment context in favor of a temporary or foreign worker.”

Ensure the deployment and use of appointees throughout the
department who are committed to successful achievement of the
department’s immigration-related missions. This includes personnel in
or overseeing not only the EOIR, but also the Office of the Attorney General,
Office of the Deputy Attorney General, Office of the Associate Attorney
General, Office of the Solicitor General, and nearly every other component/
office throughout the department.

Pursue a more vigorous anti-fraud program within the EOIR. In
perhaps no other area of law are there more attorneys who commit acts

of fraud against their clients—advancing completely meritless arguments
in exchange for exorbitant fees—than there are in the area of immigration.
Fraud and unethical behavior are rampant in the immigration system and
must be addressed—not only to ensure that the federal government is
operating in a proper manner, but also for the sake of the aliens involved in

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the process as well as the integrity/credibility of the members of the private
immigration bar who do not engage in such conduct.

ADDITIONAL ESSENTIAL REFORMS

Aligning Departmental Resources with Leadership Priorities Across All
Components and U.S. Attorneys’ Offices. As the next Administration pursues
its objectives, it should use the department’s resources efficiently in a manner
that delivers results for the American people. To accomplish this goal, it will be
necessary to:

e Ensure the assignment of sufficient political appointees throughout
the department. Ensuring adequate accountability throughout the DOJ
requires the intentional devotion of sufficient resources by the Administra-
tion—not simply replicating what was done under prior Administrations and
reflected in the Plum Book.®”” The number of appointees serving throughout
the department in prior Administrations—particularly during the Trump
Administration—has not been sufficient either to stop bad things from hap-
pening through proper management or to promote the President’s agenda.

It is not enough for political appointees to serve in obvious offices like the
Office of the Attorney General or the Office of the Deputy Attorney General.
The next conservative Administration must make every effort to obtain the
resources to support a vast expansion of the number of appointees in every
office and component across the department—especially in the Civil Rights
Division, the FBI, and the EOIR.

e End all nonessential details of department personnel—particularly
those detailed to congressional offices—until the department can
conduct a thorough review of its personnel needs. Considering all of
the many challenges facing the DOJ, the next conservative Administration
should terminate and recall all details of DOJ personnel shortly after the
President’s inauguration. After a thorough analysis of the department’s
resources and priorities is completed, details to other portions of the
executive branch and to Congress can resume.

e Ensure accountability for personnel sanctioned or referred for
discipline after a finding of misconduct. The next conservative
Administration should complete a thorough review of any sanctions
or findings of misconduct issued over the four years preceding the
inauguration to ensure that the Biden Administration acted appropriately
in response to any such sanctions or findings.

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Mandate for Leadership: The Conservative Promise

e Undertake a comprehensive review of DOJ hiring practices. The next
conservative Administration should conduct a holistic review of hiring
practices employed across all DOJ offices and components to ensure that
those practices comply with applicable law and policy. All hiring committees
associated with hiring for career positions across the department should be
assessed for impartiality to ensure that individuals are hired based on merit,
aptitude, and legal skill and not based on association with or membership in
certain ideologically aligned groups or based on illegal considerations such
as race, religion, or sex.

Eliminating Redundant Offices and Consolidating Functions to Increase
Efficiencies. The next conservative Administration should explore the possibility
of consolidating and aligning the functions of the DOJ’s various components and
offices in human resources, legal counsel, public relations, and other related areas.
While local access to appropriate personnel and resources is important, there are
inefficiencies and redundancies across the department that result in a bureaucratic,
Rube Goldberg-style design that ultimately hinders the department’s mission.
From IT infrastructure to management functions to public relations, DOJ lead-
ership should explore consolidation and intradepartmental efficiencies to obtain
the best possible support for its critical missions.

For example, the Department of Public Affairs has a dual structure of public
information officers in which there are some political appointees who lead the
office and provide support, but also career appointees who serve as public infor-
mation officers for individual divisions (Criminal Division, National Security
Division, etc.). The career officials handle the day-to-day work of the division,
which entails monitoring important cases, assisting in editing, and distribut-
ing press releases, and the political appointees will step in for larger issues that
advance the Administration’s initiatives. This could be made more efficient by
having political appointees for each division under the supervision of the Direc-
tor of Public Affairs.

Additionally, given the interplay of function between the Office of Legislative
Affairs (OLA) and the Office of Public Affairs, as well as the fact that the Assistant
Attorney General for the OLA is a Senate-confirmed position, the two offices should
be folded into one for more efficiency and proper coordination. Under an Office
of Public and Legislative Affairs, the Assistant Attorney General’s portfolio would
encompass both, with one Director/Deputy for Public Affairs and one Director/
Deputy for Legislative Affairs.

Pursuing Other Changes in Reporting Chains to Ensure Consistency with
the Law and Administration Priorities. The next conservative Administration
should undertake a comprehensive review of the DOJ’s current organizational
chart and make decisions about its structure—consistent with any authority to do

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so outside of congressional action—to ensure the most efficient accomplishment
of the department’s missions. For example:

e Is the current reporting structure for the Associate Attorney General’s Office
the best and optimal for the achievement of the department’s mission?

e Should all of the Deputy Attorney General’s direct reports continue to be
direct reports, or would a different structure achieve a better, more efficient
outcome in fulfilling the department’s mission?

e What should the Office of Legal Policy’s role be in the next conservative
Administration? Should it continue to be responsible for assisting with
judicial nominations, or should that function be assigned to the Office of
Legislative Affairs, which interacts with Congress on a daily basis?

Pursuing Legislative Changes for Assistant United States Attorneys’
Compensation. To ensure that the department can attract and retain top legal
talent away from Washington, D.C., the next conservative Administration should
seek congressional reform of the pay scale used for Assistant United States
Attorneys in the field. At aminimum, that reform should include a proposal to com-
pensate Assistant United States Attorneys on at least the same basis as attorneys
employed by Main Justice who are compensated under the GS scale. Ensuring that
the department can attract and retain top legal talent outside of the D.C. market is
essential and will help to emphasize the importance of the field’s work in achieving
the department’s various missions.

Protecting the Integrity of the Bureau of Justice Statistics and the National
Institute of Justice. The DOJ’s statistical and research arms should serve the Amer-
ican people and not special interests. The Director of the Bureau of Justice Statistics
should focus the BJS on producing the statistics of greatest interest to everyday
Americans, and hence of policymakers, rather than those of particular interest to crim-
inal-justice academics. The Director should insist that such statistics be as accurate
as possible and presented as clearly as possible. The intellectually engaged, everyday
American citizen should be able to read and understand the BJS’s published statistics
and reports rather than having to trust “experts” because the statistics are not clear.

The BJS should focus on the core statistics involving crime and punishment,
such as those relating to serious crimes committed, imprisonment, time served,
recidivism, and the like. It should not pursue the niche political agendas of aca-
demics or advocates. Moreover, a clear line should be maintained between official
government statistics and third-party contractor reports. There should be no
reports that look like official BJS reports but are authored by private entities such
as the Urban Institute as happened under the Obama Administration.

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Research funded by the National Institute of Justice should follow similar
principles. The NIJ should fund high-quality, unbiased research on the topics
of greatest interest to everyday Americans and policymakers rather than agen-
da-driven research desired by advocates or academics.

The National Crime Victimization Survey, which is the nation’s largest crime
survey and predates the BJS (it dates to the Nixon Administration), is of particular
importance, and the department should prioritize and sufficiently fund it. This
survey provides the only comprehensive and credible alternative to police reports
for showing who commits crimes. The demographic information that crime victims
provide through the survey about who commits crimes against them enables such
reports as “Race and Ethnicity of Violent Crime Offenders and Arrestees, 2018,”°°
which was published in January 2021 and finds that police are arresting those who,
according to victims, actually commit crimes.

AUTHOR'S NOTE: [he preparation of this chapter involved contributions from members of the 2025
Presidential Transition Project. Most contributors to this chapter are listed at the front of this volume—and in

the perfect cancel-proof world, all contributors of ideas would be listed—but the staff at America First Legal
Foundation deserves special mention for their assistance while juggling other responsibilities. The author alone
assumes responsibility for the content of this chapter, and no views expressed herein should be attributed to any
other individual.

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ENDNOTES

1. — Judiciary Act of 1789, ch. 20, sec. 35, 1 Stat. 73 (1789), https://judicial-discipline-reform.org/docs/Judiciary_
Act_1789.pdf (accessed February 3, 2023).
2. An Act to Establish the Department of Justice, Public Law No. 41-97, 16 Stat. 162 (1870), https://www.justice.
gov/sites/default/files/jmd/legacy/2013/10/23/act-pl41-97.pdf (accessed February 3, 2023).
3. John F. Fox, Jr, “The Birth of the Federal Bureau of Investigation,” U.S. Department of Justice, Federal Bureau
of Investigation, “History,” July 2003, https://bit.ly/3G4LmDO (accessed February 3, 2023).
4. Trafalgar Group, “Nationwide Issues Survey August 2022,” pp. 19, 22, and 25, https://www.thetrafalgargroup.
org/wp-content/uploads/2022/08/COSA-FBI_DOJ-Opinion-Full-Report-0824.pdf (accessed
February 3, 2023).
5. — John Solomon, “FBI Email Chain May Provide Most Damning Evidence of FISA Abuses Yet,” The Hi//, December
5, 2018, https://thehill.com/hilltv/rising/419901-fbi-email-chain-may-provide-most-damning-evidence-of-fisa-
abuses-yet/ (accessed February 3, 2023); Post Editorial Board, “The FBI Knew RussiaGate Was a Lie—But Hid
That Truth,” New York Post, June 11, 2022, https://nypost.com/2022/06/11/the-fbi-knew-russiagate-was-a-lie-
but-hid-that-truth/ (accessed February 3, 2023).
6. — John Solomon, “Collusion Bombshell: DNC Lawyers Met with FBI on Russia Allegations Before Surveillance
Warrant,” The Hill, October 3, 2018, https://thehill.com/hilltv/rising/409817-russia-collusion-bombshell-dnc-
lawyers-met-with-fbi-on-dossier-before/ (accessed February 3, 2023); Eric Tucker, “Ex-FBI Lawyer Admits to
False Statement During Russia Probe,” AP News, August 19, 2020, https://aonews.com/article/election-2020-
b9b3c7efS98d00d5dfee9170d66cefec (accessed February 3, 2023).
7. Jesse O'Neill, “FBI Pressured Twitter, Sent Trove of Docs Hours Before Post Broke Hunter Laptop Story,” New
york Post, December 19, 2022, https://nypost.com/2022/12/19/fbi-reached-out-to-twitter-before-post-broke-
hunter-biden-laptop-story/ (accessed February 3, 2023).
8. emorandum from Attorney General Merrick Garland to Director, Federal Bureau of Investigation; Director
the Executive Office for U.S. Attorneys; Assistant Attorney General, Criminal Division; and United States
torneys, “Subject: Partnership Among Federal, State, Local, Tribal, and Territorial Law Enforcement to
ddress Threats Against School Administrators, Board Members, Teachers, and Staff” October 4, 2021, https://
www.justice.gov/ag/page/file/1438986/download (accessed February 3, 2023) (cited hereafter as Garland
emorandum, October 4, 2021).
9. Dillon Burroughs, “25 States Have Now Left National School Boards Association as Nebraska Departs,” Daily
Wire, June 13, 2022, https://www.dailywire.com/news/25-states-have-now-left-national-school-boards-
association-as-nebraska-departs (accessed February 3, 2023).
10. Brianna Herlily, “FBI Met Weekly with Big Tech Ahead of the 2020 Election, Agent Testifies,” Fox News,
December 3, 2022, https://www.foxnews.com/politics/fbi-weekly-big-tech-ahead-2020-election-agent-
estifies (accessed February 3, 2023); Allie Griffin, “Latest ‘Twitter Files’ Show FBI Bullied Executives Over Not
Reporting ‘State Propaganda’ Enough, New York Post, December 18, 2022, https://nypost.com/2022/12/18/
atest-twitter-files-show-fbi-questioned-executives-over-users-spouting-state-propaganda/ (accessed
February 3, 2023).
11. Michael Shellenberger (@ShellenbergerMD), “In the end, the FBI's influence campaign aimed at executives
at news media, Twitter, & other social media companies worked: they censored & discredited the Hunter
Biden laptop story. By Dec. 2020, Baker and his colleagues even sent a note of thanks to the FBI for its work,”
Twitter, December 19, 2022, 1:35 PM), https://twitter.com/ShellenbergerMD/status/1604908212628598784
(accessed February 3, 2023).
12. Press release, “Eleven Charged with FACE Act Violations Stemming from 2021 Blockade of Mount Juliet
Reproductive Health Clinic,” U.S. Department of Justice, United States Attorney’s Office, Middle District of
Tennessee, October 5, 2022, https://www,justice.gov/usao-mdtn/pr/eleven-charged-face-act-violations-
stemming-2021-blockade-mount-juliet-reproductive (accessed February 3, 2023); Kaelan Deese, “DOJ
Official Touts Prosecution of Anti-Abortion Advocates While Vandalized Pregnancy Centers Await Justice,”
ashington Examiner, December 14, 2022, https://www.washingtonexaminer.com/news/justice/doj-official-
admits-to-prosecuting-pro-life-advocates (accessed February 3, 2023); S. 636, Freedom of Access to Clinic
Entrances Act of 1994, Public Law No. 103-259, 103rd Congress, May 26, 1994, https://www.congress.gov/103/
statute/STATUTE-108/STATUTE-108-Pg694.pdf (accessed February 5, 2023).

rLreo

— 573 —

13:

17.

18.

19.

20.

21.

Mandate for Leadership: The Conservative Promise

Aruna Viswanatha and Sadie Gurman, “Almost Half of Federal Cases Against Portland Rioters Have Been

JUS

February 3, 2023).

February 3, 2023).
Joyce White Vance, “The Justice Department Is Suing Georgia

ustice-department/index.html (accessed February 3, 2023).

by-kamala-harris/ (accessed February 3, 2023).

onl

ump-absolutely-disgraceful (accessed February 3, 2023).
8 U.S. Code § 1524 (Bringing in and harboring certain aliens), ht

cornell.edu/uscode/text/8/1326 (accessed February 5, 2023): 8

— 574 -—

Press release, “Justice Department Sues Texas Over Senate Bill 8: Compla
Constitution by Effectively Banning Most Abortions,” U.S. Departmen
www,justice.gov/opa/pr/justice-department-sues-texas-over-senate-bill-
Dorian Geiger, “DOJ Warns States Over Blocking Access to Gender-Affirm
31, 2022, https://www.axios.com/2022/03/31/doj-warns-states-blocki

Don't
fashington Post, June 29, 2021, https://www.washingtonpost.com/o
suing-georgia-voting/ (accessed February 3, 2023); David Nakamura and
Sues Texas Over State Redistricting Maps, Citing Discrimination Against Latinos,” The Washington Post,
December 6, 2021, https://www.washingtonpost.com/national-security/te
justice/2021/12/06/4011ce78-56aa-llec-9al8-a506cf3aa3ld_story.h
Lybrand and Paul LeBlanc, “Justice Department Sues Arizona Over New E
Citizenship,” CNN, updated July 5, 2022, https://www.cnn.com/2022/07/05/politics/arizona-election-law-

(accessed March 9, 2023); 8 U.S. Code § 1325 (Improper entry by a
ext/8/1325 (accessed February 5, 2023); 8 U.S. Code § 1326 (Reentry of removed aliens), https:/Avww.law.

U.S. Code §

aliens to enter), httos://www.law.cornell.edu/uscode/text/8/1327 (accessed
(Importation of alien for immoral purpose), https://www.law.cornell.edu/uscode/text/8/1328 (accessed February

5, 2023; press release, “In Brief Filed with Supreme Court, AFL H
of MPP—Cites Alarming Statistic That Biden Administration Has Already Re
Aliens into the United States from the Border,’ America First Legal Foundat
in-brief-filed-with-supreme-court-afl-hammers-biden-administrations-tern
statistic-that-biden-administration-has-already-released-more-than-750000-ille/ (accessed February 5, 2023).

Dismissed,” The Wall Street Journal, updated April 15, 2021), https://www.ws).com/articles/almost-half-

of-federal-cases-against-portland-rioters-have-been-dismissed-11618501979 (accessed February 3, 2023):
he News Staff, “Antifa-led Portland Rioter Charged with Assault Poli
Community Service,” Just the News, updated December 30, 2021, https://justthenews.com/government/
courts-law/antifa-led-portland-rioter-charge-assault-police-has-case-dismi

ce [sic] Has Case Dismissed After
missed-after (accessed
int Alleges Senate Bill 8 Violates the

t of Justice, September 9, 2021, https://
8 (accessed February 3, 2023).

ing Treatment,” Axios, March

ng-gender-affirming-care (accessed

Expect Garland to End There,” The
utlook/2021/06/29/merrick-garland-

Devlin Barrett, “Justice Dept.

Xas-maps-garland-latinos-

ml (accessed February 3, 2023); Holmes

lection Law Requiring Proof of

Zachary Pottle, “America’s Fentanyl Crisis Is Getting Worse,” Addiction Center, August 26, 2022, https://www.
addictioncenter.com/news/2022/08/americas-fentanyl-crisis/ (access
Emily Jacobs, “Merrick Garland Speaks at DOJ Before Swearing-in by VP Kamala Harris,” New York Post,
updated March 11, 2021, https://nypost.com/2021/03/1l/merrick-garland-s

ed February 3, 2023).

peaks-at-doj-before-swearing-in-

Eliot H. Lumbard, “State and Local Government Crime Control,” Notre Dame Law Review,
Vol. 43, Issue 6 (1968), pp. 899-907, https://scholarship.law.nd.edu/cgi
cgiehttpsredir=1&article=3119&context=ndlr (accessed February 3, 2023).
Emma Colton, “Chio Roy Demands DOJ Explain Light Sentence for Floyd Riot Arsonist Who Killed Father of
5,” Fox News, February 10, 2022, https://www.foxnews.com/politics/ch
arsonist-riots-2020 (accessed February 3, 2023); Chris Enloe, “DOJ Asked for Lenient Sentence for 2020

Rioter Who Burned Down Pawn Shop, Killing One Man. Prosecutors Even Cited MLK,” Blaze Media News,
January 29, 2022, https://www.theblaze.com/news/doj-lenient-sentence-rioter-arson#toggle-gdpr (accessed
February 3, 2023); Chris Pandolfo, “House Republicans Release 1,000-Page Report Alleging Politicization in

he FBI, DOJ,” Fox News, November 4, 2022, https://www.foxnews.com/politics/house-republicans-release-
000-page-report-alleging-politicization-fbi-doj (accessed February 3, 2023); Brooke Singman, “Cruz Slams
‘Politicized’ Biden DOJ for Appointing Trump Special Counsel: ‘Absolutely Disgraceful,”” Fox News, November19,
2022, https://www.foxnews.com/politics/cruz-slams-biden-doj-appointing-special-counsel-investigate-

/viewcontent.

ip-roy-light-sentence-george-floyd-

ps://\www.law.cornell.edu/uscode/text/8/1324
ien), httos:/(www.law.cornell.edu/uscode/

327 (Aiding or assisting certain
February 5, 2023); 8 U.S. Code § 1328

ammers Biden Administration’s Termination

eased More Than 750,000 Illegal

ion, April 14, 2022, https://aflegal.org/

nination-of-mpp-citing-alarming-

22.

23.

24.

25.

26.

27.

28.

29.

30.

31.

32.

33.

34,

35.

36.

Sf.

“The FB

2025 Presidential Transition Project

bi-l
by the FBI? Justice Depar
bi-justi
Accoun
rea
ary
The Dai

S for ‘Misinformati

y Signal, October 26, 2022,

Court Justices,
argetin
Solomon, “FBI
Knew

” Politico, J

Email Chai
RussiaGate

n May Pro’

nt of Jus
istory/bri

U.S. Departme
www.fbi.gov/h
Press release, “FBI and
Department of Justice,
press-releases/press-re

abortion-activist-enforcing-law-pro-

Editorial Board, “About Those Domestic-Terrorist Paren

635285900 (accessed February 3, 2023); John Ma

on,” New York Post, updated

https://www.dai

vide Most Damn

Was a Lie—But Hid That Tru
Hours Before Post Broke Hunter Lap
ice, Federal Bureau of Investigation, “History: The Nation Calls, 1908-1923,” https://
-history/the-nation-calls (accessed February 3, 2023).

Law Enforcement Partners Arrest Near
Federal Bureau of Investigation, Septe
eases/fbi-and-law-enforcement-partn

op Story.”

summer (accessed February 3, 2023).

See, for example, Joseph Goldstein, “As Seen in ‘Goodfellas’:
York Times, January 23, 2014, https://www.nytimes.com
igation-including-78-lufthansa-heist.html (accessed February 3, 2023).
ace, “FBI Nationwide Operation Locates 121 Acti
ews, August 15, 2022, https://www.foxnews.com/us/fbi
hild-sex-trafficking-victims (accessed February 3, 2023).
“EBI Stepped in After Suspec

New
inves
Daniel
Fox
kids-c
Adam Shaw,
Finds,” Fox

politicians (accessed
The precise scope and contours of t
rafficking investigations or specific
inthe
as comprehensive a review as possi
28 U.S. Code § 531, https://Awww.
Emphasis added.
The same could be sai
arshals Service, alth
why the department

e Wal

d to apply to

should mainta

same way as high-profile, politically

aw.cornel

his revi
violen

ble.

ifers/ ; Josh Gerstein, “DOJ
uly 28, 2022, https://www.po
g-of-supreme-court-justices-00048506 (accessed Febr

lys

Eviden
nO

ing

ed Chinese Spy Got Close to Swalwel
ews, December 8, 2020, https://www.foxnews.com/politics/fbi-chinese-spy-swalwell-other-
February 3, 2023).

st Enforcing the Law Against Pro-Li
ignal.com/2022/10/26/dojs-kristen-clarke-pro-
icial Pressed on Targeting of Supreme
itico.com/news/2022/07/28/doj-official-pressed-on-
uary 3, 2023).

ce of FISA Abuses Yet”; Post Editorial Board,
ll, “FBI Pressured Twitter, Sent Trove of Docs

Arrest Is Made in’78 Lufthansa
/2014/01/24/nyregion/arrests-in-cold-case-

vely Missing Kids, Child Sex Traf
-nationwide-opera

s,” The Wall Street Journal, October 26, 2021, https://www.
wsj.com/articles/about-those-domestic-terrorists-national-school-boards-association-merrick-garland-memo-
com, “Are Parents Being Tagged as ‘Domestic Terrorists’
ment Needs to Show Its Cards,” Heritage Foundation Commentary, November
httos://www.heritage.org/crime-and-justice/commentary/are-paren

8, 2021,

s-being-tagged-domestic-terrorists-the-
ce (accessed February 3, 2023); Victor Nava, “FBI Treated Twitter as a ‘Subsidiary, Flagged Tweets
December 16, 2022, https://nypost.com/2022/12/
ed-twitter-as-subsidiary-flagged-tweets-for-misinformation/ (accessed February 3, 2023).

argaret Olohan, “DOJ’s Kristen Clarke: A Pro-Abortion Activi

and
6/fbi-

ers,”

ly 6,000 Violent Criminals This Summer,” U.S.
mber 13,
ers-arrest-nearly-6000-violent-criminals-this-

2022, https://www.fbi.gov/news/

Robbery,” The

icking Victims,”
ion-locates-actively-missing-

, Other Politicians, Report

ew warrant special consideration. A review of all ongoing drug
crime investigations may not warran
sensitive investigations likely will. Nevertheless, the goal should be

the department's attention

edu/uscode/text/28/531 (accessed February 3, 2023).

he Bureau of Alcohol, Tobacco, and Firearms and potentially to the U.S.
ough the USMS’s mission protecting the federal courts could present compelling reasons
in it as a direct report to the Deputy Attorney General.

See, for example, Alexander Hamilton, The Federalist Papers No. 1, October 27, 1787, https://founders.archives.

gov/documents/Ham
An argument could a

so be made th

back to the Robert F. Kennedy build
reality: The FBI is a component of the department, n

U.S. Department of Justice, Office o

the Inspector G

ot its equal, as ou

ilton/01-04-02-0152 (accessed February 3, 2023).
at the upper echelons of the FBI’s
ing to ensure proper accountability and to emphasize organizational

eadership should physically relocate

lined above.

eneral, Audit of the Roles and Responsibilities of the

Federal Bureau of Investigation’s Office of the General Counsel in National Security Matters, Report No. 22-16,

September 2022, https://oig justice.
S. 2212, Crime Control Act of 1976, P
amended at 28 U.S. Code § 532), ht
pdf (accessed February 3, 2023).

See “Enhancing Federal Focus and Resources in Juri

gov/sites/defaul
ublic Law No. 94

/files/reports/22-
-503, October 15,

— 575 —

]6.pdf (accessed February 3, 2023).

976, § 203, 90 Stat. 2427 (codified as

ps://www.congress.gov/94/statute/STATUTE-90/STATUTE-90-Pg2407.

sdictions with Rule-of-Law Deficiencies,” infra.

Mandate for Leadership: The Conservative Promise

Garland Memorandum, October 4, 2021; press release, “America First Legal Seeks Two Federal Investigations
on Attorney General Merrick Garland’s Infamous Oct. 4th Memo Siccing the FBI on Concerned Parents,”
America First Legal Foundation, March 14, 2022, https://aflegal.org/america-first-legal-seeks-two-federal-
investigations-on-attorney-general-merrick-garlands-infamous-oct-4th-memo-siccing-the-fbi-on-concerned-
parents/ (accessed February 3, 2023).
Luke Rosiak, “In Aftermath of Enemies List, School Committee Pledges to ‘Silence the Opposition,” Daily Wire,
March 27, 2021, https://www.dailywire.com/news/after-enemies-list-school-body-pledges-to-silence-the-
opposition (accessed February 3, 2023).
The language of the Equal Protection Clause “reflects that ‘achieving equal protection against lawbreakers
was at the core of the Clause’s objectives.” Lefebure v. DAquilla, 15 F.4th 650, 669 (5th Cir. 2021) (Graves, J.
dissenting) (quoting Lawrence Rosenthal, “Policing and Equal Protection,” Yale Law & Policy Review, Vol.
21, No. 53 (2003), p. 70) cert. denied, 212 L. Ed. 2d 791, 142 S. Ct. 2732 (2022)), https://casetext.com/case/
efebure-v-daquilla-2 (accessed February 3, 2023).
See, for example, Portland Mayor Ted Wheeler’s actions in 2020 calling on federal officials—executing their
ission to protect federal property and officials—to leave the city, saying, “They're not wanted here” despite
e fact that local reports found that “[oJut of more than a thousand arrests reported by the Portland Police
ureau and other local law enforcement since late May 2020, only about 8.4% of the cases are still open”
nd that the “rest have been dismissed or listed as no complaint, which means authorities are not currently
ursuing charges.” BBC News, “Portland Protests: Mayor Demands Federal Officers Leave City,” July 20, 2020,
os://www.bbc.com/news/world-us-canada-53466718 (accessed February 3, 2023), and Hannah Lambert,
% of Portland Protest Arrests Not Being Prosecuted,” Portland Tribune, January 5, 2021, https://archive.ph/

42.

43.
Ad.

AS.

46.

47.

48.

49.

50.

ol.

52.

53.

im] Wh: oO > oO

SDbz (accessed
gure 4, “T

S. 1586, Restoring

hi
applicable cases,
2
(accessed Februa
8

For more on th
See Paul J. Lar
er
iles/2022-11/L
Jessica Rendal

US.
China In
2021, ht
compilation-ch

itiative

Trend in
scal Years 2010-2019,” in U.S. Sen
and Pathways, Ma
U.S. Code § 924(e), https://www.

congress.gov/bill/

U.S. Code § 801 et seq., h

, 100,000 Peop
ovember 18, 202

Department o

ps://www.

February 3,2023).

ch 2021, p. 26, ht

Average Guideline Minimum and Average Sentence Imposed for Armed Career Criminals
encing Commission, Federal Armed Career Criminals: Prevalence, Patterns,
ps://www.ussc.gov/sites/default/files/odf/research-and-publications/
research-publications/2021/20210303_ ACCA-Report.pdf (accessed February 3, 2023).
aw.cornell.edu/uscode/text/18/924 (accessed February 3, 2023).

he Armed Career Criminal Act, 117th Congress, introduced May 12, 2021, https://www.
17th-congress/senate-bill/1586 (accessed February 6, 2023).

s could require seeking the Supreme Court to overrule Kennedy v. Louisiana, 554 U.S. 407 (2008), in

but the department should place a priority on doing so.

ry 3, 2023).

, “Twenty-First Centur

age Foundation Legal Memorandum

13.pdf.

e Died fron

ing Enforcement

y Illicit Drugs and T|

tos://www.law.cornell.edu/uscode/text/21/chapter-13/subchapter-|/part-A

U.S. Code §§ 1961-1968, httos://www.law.cornell.edu/uscode/text/18/part-I/chapter-96 (accessed
February 3, 2023).
is topic generally, see “Ensur|

and Administration of Our Immigration Laws,” infra.
heir Discontents: The Scourge of Illicit Fentanyl,”

0. 313, November 1, 2022), https://www.heritage.ora/sites/default/

n Drug Overdoses in the US in One Year, a Record,” CNET,

, https://www.cnet.com/health/medical/100000-people-died-from-drug-overdoses-in-
he-us-in-one-year-a-record/ (accessed February 3, 2023).

Justice, National Security Division, “Information About the Department of Justice’s
and a Compilation of China-Related Prosecutions Since 2018,” last updated November 19,
justice.gov/archives/nsd/information-about-department-justice-s-china-initiative-and-
ina-related (accessed February 3, 2023).

Ronn Blitzer and Jake Gibson, “Biden DOJ Ending National Security Initiative Aimed at Countering China amid

Complaints Abou

Bias,” Fox News, February 23, 2022, https://www.foxnews.com/politics/doj-ending-china-

initiative-national-security-program-bias (accessed February 3, 2023).

National Security Strategy, The White House, October 2022, p. 23, https://www.whitehouse.gov/wp-content/
uploads/2022/10/Biden-Harris-Administrations-National-Security-Strategy-10.2022.pdf (accessed February 3,
2023). See also ibid., p. 8.

— 576 —

54.
ao
56.

Sf;

58.
59.
60.
61.
62.
63.

64,

65.

66.

67.
68.
69.
70.
71.
72.
73.

74,

75.

76.
77.

78.

2025 Presidential Transition Project

U.S. Department of Justice, “About DOJ: Our Mission,” https://wwwjjustice.gov/about (accessed February 4, 2023).
18 U.S. Code § 248, https://www.law.cornell.edu/uscode/text/18/248 (accessed February 4, 2023).

Danielle Wallace and Jake Gibson, “Pro-life Activist Mark Houck Pleads Not Guilty to Federal Charges After FBI
Arrest,” Fox News, September 27, 2022, https://www.foxnews.com/us/pro-life-activist-mark-houck-pleads-
not-guilty-federal-charges-fbi-arrest (accessed February 4, 2023).

Patty Knap, “Paul Vaughn, Pro-life Father of 11 Arrested by FBI Speaks Out,” National Catholic Register,
October 18, 2022, https://www.ncregister.com/news/paul-vaughn-pro-life-father-of-Il-arrested-by-fbi-speaks-
out (accessed February 4, 2023).
597 US.____ (2022), https://supreme.justia.com/cases/federal/us/597/19-1392/case.pdf (accessed
February 4, 2023).
Jonah McKeown, “TRACKER: Pro-Abortion Attacks in the U.S. Continue (Updated),” Catholic News Agency,
last updated September 22, 2022, https://www.catholicnewsagency.com/news/251553/map-vandalism-
attacks-continue-at-pro-life-centers-across-us (accessed February 4, 2023).

28 U.S. Code § 516, https://www.law.cornell.edu/uscode/text/28/516 (accessed February 4, 2023).

28 U.S. Code § 519, https://www.law.cornell.edu/uscode/text/28/519 (accessed February 4, 2023).

295 US. 602 (1935), https://supremejustia.com/cases/federal/us/295/602/ (accessed February 6, 2023).
591U.S.___ (2020), https://www.supremecourt.gov/opinions/19pdf/19-7_new_Opmi.pdf (accessed
February 6, 2023).
See Brief for the United States, 303 Creative v. Aubrey Elenis, No. 21-476, August 2022, https://www.
supremecourt.gov/DocketPDF/21/21-476/234119/20220819182151542_21-476%20303%20Creative%20LLC%20
V.%20Elenis%20FINAL.pdf (accessed February 4, 2023).
Oral Argument Transcript, 3035 Creative v. Aubrey Elenis, No. 21-476, December 5, 2022, https://
www.supremecourt.gov/oral_arguments/argument_transcripts/2022/21-476_8n59.pdf (accessed
February 4, 2023).
Brief for the United States, Masterpiece Cakeshop Ltd. v. Colorado Civil Rights Commission, No. 16-111,
September 2017, p. 9, https://www.scotusblog.com/wp-content/uploads/2017/09/16-111-tsac-USA.pdf
(accessed February 4, 2023) (quoting Agency for International Development v. Alliance for Open Society
International, Inc., 133 S. Ct. 2321, 2327 (2013), quoting in turn Rumsfeld v. Forum for Academic & Institutional
Rights, Inc., 547 U.S. 47, 61 (2006)).

Ibid., p. 10.

Ibid., pp. 10-11.

West Virginia State Board of Education v. Barnette, 319 U.S. 624, 642 (1943), https://tile.loc.gov/storage-
services/service/ll/usrep/usrep319/usrep319624/usrep319624.pdf (accessed February 4, 2023).

Cohen v. California, 403 U.S. 15, 24 (1971), https://constitutionallawreporter.com/wp-content/uploads/2014/07/
Cohen-v_-California.pdf (accessed February 4, 2025).

West Virginia State Board of Education v. Barnette, 319 U.S. 640.

McCullen v, Coakley, 573 U.S. 464, 476 (2014), https://supreme justia.com/cases/federal/us/573/12-1168/
case.pdf (accessed February 4, 2023) (quoting FCC v. League of Women Voters of California, 468 U.S. 364,
377 (1984)).

See, for example, 42 U.S. Code § 2000d, https://www.law.cornell.edu/uscode/text/42/2000d (accessed February
4, 2023); 42 U.S. Code § 2000e, https://www.law.cornell.edu/uscode/text/42/2000e (accessed February 4,
2023); 20 U.S. Code § 1681, https://www.law.cornell.edu/uscode/text/20/1681 (accessed February 4, 2023)

See “Advancing Equity and Racial Justice Through the Federal Government,” The White House, https://www.
whitehouse.gov/equity/ (accessed February 4, 2023).
18 U.S. Code § 1461, https://www.law.cornell.edu/uscode/text/18/1461 (accessed February 6, 2023). See also 18
U.S. Code § 1462, https://www.law.cornell.edu/uscode/text/18/1462 (accessed February 6, 2023).

18 U.S. Code § 241, https://www.law.cornell.edu/uscode/text/18/241 (accessed February 6, 2023).

A similar argument could be advanced for the department's other criminal law enforcement responsibilities
such as those within the Environmental and Natural Resources Division.

See, for example, Paul Kiel, “Controversial USA Delivered ‘Voter Fraud’ Indictments Right on Time,” TPM
Muckraker, May 1, 2007, https://web.archive.org/web/20070503021505/http://www.tommuckraker.com/
archives/003107,php (accessed February 4, 2023).

— 577 —

79.

80.

81.

82.

83.
84.

85.

86.

87.

88.

89.

90.

91.
92.

Mandate for Leadership: The Conservative Promise

See Craig C. Donsanto and Nancy L. Simmons, Federal Prosecution of Election Offenses, 7th Edition,

U.S. Department of Justice, May 2007 (revised August 2007), pp. 61-63, https://www,justice.gov/sites/
default/files/criminal/legacy/2013/09/30/electbook-rvs0807.pdf#tpage=79 (accessed February 4, 2023).
See also Richard C. Pilger, ed., Federal Prosecution of Election Offenses, 8th Edition, U.S. Department of
Justice, December 2017, pp. 56-58, https://www.justice.gov/criminal/file/1029066/download (accessed
February 4, 2023).
See U.S. Department of Justice, “Capital Eligible Statutes Assigned by Section,” httos:/Avwwjustice.
gov/archives/jm/criminal-resource-manual-/1-capital-eligible-statutes-assigned-section (accessed
February 5, 2023).
See U.S. Department of Justice, “Contact List: District Election Officers,” October 31, 2022, p. 1, httos://www.
justice.gov/criminal/file/1329606/download (accessed February 4, 2023).
Pennsylvania Department of State, “Pennsylvania Provisional Voting Guidelines,” October 21, 2020, Version 1.1,
p. 2, httos://www.dos.pa.gov/VotingElections/OtherServicesEvents/Documents/PADOS._ProvisionalBallots_
guidance_1.0.pdf#page=2 (accessed February 4, 2023).
52 U.S. Code § 21082, https://www.law.cornell.edu/uscode/text/52/21082 (accessed February 4, 2023).
Pennsylvania General Assembly, SB 422, Pennsylvania Election Code—Omnibus Amendments, Act of
arch 27, 2020, PL. 41, No. 12, Section 1302-D, https://www.legis.state.pa.us/cfdocs/Legis/LI/uconsCheck.
cfmetxtlype=HTM&yr=20208sessind=O0&smthLwind=O&act=12 (accessed February 4, 2023).

In re November 3, 2020 General Election, 240 A.3d 591 (Pa. 2020), https://www.leagle.com/decision/
inpaco20201026a01 (accessed February 4, 2023).
U.S. Department of Justice, “Enforcement of Civil Rights Criminal Statutes,” https://www,justice.gov/jm/jm-
8-3000-enforcement-civil-rights-criminal-statutes (accessed February 4, 2023); U.S. Department of Justice,

“Capital Eligible Statutes Assigned by Section,” updated January 17, 2020, https:/Awww,justice.gov/archives/jm/

criminal-resource-manual-/1-capital-eligible-statutes-assigned-section (accessed February 4, 2023).

Garland Memorandum, October 4, 2021.

See Viola M. Garcia, President, NSBA, and Chip Slavin, Interim Executive Director and CEO, to President
Joseph R. Biden, “Re: Federal Assistance to Stop Threats and Acts of Violence Against Public Schoolchildren,
Public School Board Members, and Other Public Schoo! District Officials and Educators,’ September 29, 2021,
https://s3.documentcloud.org/documents/21098209/nsba-letter-to-president-biden-concerning-threats-to-
public-schools-and-school-board-members-929711.pdf (accessed February 4, 2023). Emphasis in original.
See letter from Todd Rokita, Indiana Attorney General; Steve Marshall, Alabama Attorney General: Treg R.
Taylor, Alaska Attorney General; Mark Brnovich, Arizona Attorney General: Leslie Rutledge, Arkansas Attorney
General; Christopher M. Carr, Georgia Attorney General; Derek Schmidt, Kansas Attorney General; Daniel
Cameron, Kentucky Attorney General; Eric S. Schmitt, Missouri Attorney General; Austin Knudsen, Montana
Attorney General: John M. O’Connor, Oklahoma Attorney General; Alan Wilson, South Carolina Attorney
General; Jason R. Ravnsborg, South Dakota Attorney General; and Ken Paxton, Texas Attorney General to
resident Joseph R. Biden, Jr., and Attorney General Merrick B. Garland, Attorney General, “Re: NSBA’s Fraud
on the American People,” October 26, 2021, https://Awww.texasattorneygeneral.gov/sites/default/files/global/
images/DOJ%20Letter%20based%200n%20NSBA%20Apology%20Letter%20%2010.26.21%20final.pdf
(accessed February 4, 2023). Cited hereafter as Rokita et al. Letter, October 26, 2021.

Philip G. Kiko, Final Report on the Events Surrounding the National School Boards Association's

September 29, 2021, Letter to the President, n.d., httos:/Avww.nsba.org/-/media/Files/NSBA-Report.
odfela=en&hash=A001354D23C9AE88B54D398270C9790D9IBOIFFY (accessed February 4, 2023); news release,

“NSBA Announces Completion of Independent Review; Takes Action Based on Findings,” National School Boards

Association, May 20, 2022, https:/Avwww.nsba.org/News/2022/independent-review#:-:text=In%20February%20
2022%2C%20the%20National%20School%20Boards%20Association,and%20assistance%20with%20events%20
at%20school%20board%20meetings. (accessed February 4, 2023).

Rokita et al. Letter, October 26, 2021.

State of New York, State of Connecticut, State of New Jersey, State of Washington, Commonwealth

of Massachusetts, Commonwealth of Virginia, State of Rhode Island, City of New York v. United States
Department of Justice, 964 F.3d 150 (2d Cir. 2020), https://casetext.com/case/new-york-v-us-dept-of-justice-1
(accessed February 4, 2023).

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93.

94.

95.

96.

97.

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H.R. 5005, Homeland Security Act of 2002, Public Law No. 107-296, 107th Congress, November 25, 2002, 116
Stat. 2135, https:/Awww.congress.gov/107/plaws/publ296/PLAW-107publ296.pdf (accessed February 3, 2023).
See, for example, 8 U.S. Code §§ 1103(a)(1) and 1103(g), https://www.law.cornell.edu/uscode/text/8/1103
(accessed February 3, 2023).

See, for example, 8 U.S. Code §§ 1324-1326, https://www.law.cornell.edu/uscode/text/8/chapter-12/
subchapter-Il/part-VIll (accessed February 3, 2023).

Press release, “Justice, Labor Departments Reach Settlements with Facebook Resolving Claims o
Discrimination Against U.S. Workers and Potential Regulatory Recruitment Violations,” U.S. Departmen
of Justice, October 19, 2021, https://www,justice.gov/opa/pr/justice-labor-departments-reach-settlements-
acebook-resolving-claims-discrimination-against (accessed February 3, 2023).
“Every four years, just after the Presidential election, the ‘United States Government Policy and Supporting
Positions, commonly known as the Plum Book, is published, alternately, by the Senate Committee on
Homeland Security and Governmental Affairs and the House Committee on Oversight and Governmen
Reform.” Senate Committee Print No. 114-26, United States Government Policy and Supporting Positions,
Committee on Homeland Security and Governmental Affairs, U.S. Senate, 114th Cong., 2nd Sess., December
, 2016, p. iii, httos://www.govinfo.gov/content/pkg/GPO-PLUMBOOK-2016/pdf/GPO-PLUMBOOK-2016.pdf
(accessed February 5, 2023).
Allen J. Beck, “Race and Ethnicity of Violent Crime Offenders and Arrestees, 2018,” U.S. Department of Justice,
Office of Justice Programs, Bureau of Justice Statistics, Statistical Brief No. NCJ 255969, January 2021, https://
bjs.ojp.gov/content/pub/pdf/revcoal8.pdf (accessed February 3, 2023).

— 579 —

DEPARTMENT OF LABOR
AND RELATED AGENCIES

Jonathan Berry

MISSION STATEMENT

At the heart of The Conservative Promise is the resolve to reclaim the role of
each American worker as the protagonist in his or her own life and to restore the
family as the centerpiece of American life. The role that labor policy plays in that
promise is twofold: Give workers the support they need for rewarding, well-paying,
and self-driven careers, and restore the family-supporting job as the centerpiece of
the American economy. The Judeo-Christian tradition, stretching back to Genesis,
has always recognized fruitful work as integral to human dignity, as service to God,
neighbor, and family. And Americans have long been known for their work ethic.
While it is primarily the culture’s responsibility to affirm the dignity of work, our
federal labor and employment agencies have an important role to play by protect-
ing workers, setting boundaries for the healthy functioning of labor markets, and
ultimately encouraging wages and conditions for jobs that can support a family.

OVERVIEW

The labor agencies covered in this chapter include the Department of Labor
(DOL), the Equal Employment Opportunity Commission (EEOC), the National
Labor Relations Board (NLRB), the National Mediation Board (NMB), the Federal
Mediation and Conciliation Service (FMCS), and the Pension Benefit Guaranty
Corporation (PBGC). Congress has provided these agencies with the authority to
enforce a wide range of federal statutes regulating workplace conduct, workforce
development, employee benefits, labor organization and bargaining, and interna-
tional labor conditions.

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Inthe sweep of American history, these authorities are relatively new. They largely
come from Congress’s attempts in the middle of the 20th century to resolve major
political questions brought about by labor conflict, the civil rights movement, and the
emergence of the modern workplace. The 21st century has brought about new chal-
lenges, ranging from collapsing manufacturing sector employment and a decrease in
family-supporting jobs, to the massive expansion of an increasingly radical human-re-
sources bureaucracy. In many cases, these challenges are as significant as the 20th
century labor crises and workplace changes that the agencies were developed to manage.

But the agencies have failed to respond to these challenges. Despite significant
progress by the Trump Administration, a massive administrative state now hangs
over productive industry and labor organization, acting as a damper on social and
economic life. And under the Biden Administration, that administrative state has
imposed the most assertive left-wing social-engineering agenda in the agencies’
history and ratcheted up regulatory costs on small businesses and other productive
industry. The agencies’ authorities have been abused by the Left to favor human
resources bureaucracies, climate-change activists, and union bosses—all against
the interest of American workers.

NEEDED REFORMS

Reverse the DEI Revolution in Labor Policy. Under the Obama and Biden
Administrations, labor policy was yet another target of the Diversity, Equity, and
Inclusion (DED) revolution. Under this managerialist left-wing race and gender ideol-
ogy, every aspect of labor policy became a vehicle with which to advance race, sex, and
other classifications and discriminate against conservative and religious viewpoints
on these subjects and others, including pro-life views. The next Administration
should eliminate every one of these wrongful and burdensome ideological projects.

Eliminate Racial Classifications and Critical Race Theory Trainings. The
Biden Administration has pushed “racial equity” in every area of our national life,
including in employment, and has condoned the use of racial classifications and
racial preferences under the guise of DEI and critical race theory, which categorizes
individuals as oppressors and victims based on race. Nondiscrimination and equal-
ity are the law; DETis not. Title VII flatly prohibits discrimination in employment
on the basis of race, color, and national origin. The President should:

e Issue an executive order banning, and Congress should pass a law
prohibiting the federal government from using taxpayer dollars to
fund, all critical race theory training (CRT).

e Direct DOJ and EEOC to enforce Title VII. The President should

direct the Department of Justice and Equal Employment Opportunity
Commission to enforce Title VII to prohibit racial classifications and quotas,

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including human-resources classifications and DEI trainings that promote
critical race theory.

e Eliminate EEO-1 data collection. The Equal Employment Opportunity
Commission collects EEO-1 data on employment statistics based on race/
ethnicity, which data can then be used to support a charge of discrimination
under a disparate impact theory. This could lead to racial quotas to remedy
alleged race discrimination. (The Office of Federal Contract Compliance
Programs (OFCCP) also has a right to the data EEOC collects.) Crudely
categorizing employees by race or ethnicity fails to recognize the diversity
of the American workforce and forces individuals into categories that do not
fully reflect their racial and ethnic heritage.

e Amend Title VII. The next Administration should work with Congress
to amend Title VII to prohibit the Equal Employment Opportunity
Commission from collecting EEO -1 data and any other racial classifications
in employment for both private and public workplaces.

e Eliminate disparate impact liability. With interracial marriages in
America increasing, many Americans do not fit neatly into crude racial
categories.’ Under disparate impact theory, moreover, discriminatory
motive or intent is irrelevant; the outcome is what matters. But all
workplaces have disparities.

Congress should:

e Eliminate disparate impact as a valid theory of discrimination for
race and other bases under Title VII and other laws. Disparities do not
(and should not legally) imply discrimination per se.

The President should:

e Sign an executive order explicitly forbidding OFCCP from using
disparate impact in its analysis.

e Eliminate OFCCP. The Office of Federal Contract Compliance Programs
(OFCCP) exists to enforce Executive Order (EO) 11246.” That order was
originally signed in 1965 to require federal contractors (and subcontractors)
to commit to nondiscrimination. It gave enforcement authority to
the Department of Labor, up to and including debarment from federal
contracting. The Equal Employment Opportunity Commission has since

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Mandate for Leadership: The Conservative Promise

grown, often making OFCCP’s authority redundant and imposing a second
regulatory agency under whose rules businesses must operate. In addition,
under EO 11246, the President and DOL can force a huge swath of American
employers to comply with rules and regulations based on novel anti-
discrimination theories (such as sexual orientation and gender identity
theories) that Congress had never imposed by statute.

e Rescind EO 11246. The President should eliminate OFCCP by simply
rescinding EO 11246. Federal contractors would still be bound by statutory
nondiscrimination law but would no longer work under overlapping
regimes. (Contractors’ residual obligations under Section 503 of the
Rehabilitation Act and Vietnam Era Veterans’ Readjustment Assistance Act
(VEVRAA) could be enforced by EEOC or DOL.) Contractors also would be
less subject to the changing political whims of a President that might impose
significant new costs or burdens on the contractors.

Sex Discrimination. The Biden Administration, LGBT advocates, and some
federal courts have attempted to expand the scope and definition of sex discrimi-
nation, based in part on the Supreme Court’s decision in Bostock v. Clayton County.
Bostock held that “an employer who fires someone simply for being homosexual
or transgender” violates Title VII’s prohibition against sex discrimination. The
Court explicitly limited its holding to the hiring/firing context in Title VII and
did not purport to address other Title VII issues, such as bathrooms, locker rooms,
and dress codes, or other laws prohibiting sex discrimination. Notably, the Court
focused on the status of the employees and used the term “transgender status”
rather than the broader and amorphous term “gender identity.”

e Restrict the application of Bostock. The new Administration should
restrict Bostock’s application of sex discrimination protections to sexual
orientation and transgender status in the context of hiring and firing.

e Withdraw unlawful “notices” and “guidances.” The President should
direct agencies to withdraw unlawful “notices” and “guidances” purporting
to apply Bostock’s reasoning broadly outside hiring and firing.

e Rescind regulations prohibiting discrimination on the basis
of sexual orientation, gender identity, transgender status, and
sex characteristics. The President should direct agencies to rescind
regulations interpreting sex discrimination provisions as prohibiting
discrimination on the basis of sexual orientation, gender identity,
transgender status, sex characteristics, etc.

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Direct agencies to refocus enforcement of sex discrimination laws.
The President should direct agencies to focus their enforcement of sex
discrimination laws on the biological binary meaning of “sex.”

PRO-LIFE MEASURES

Promote pro-life workplace accommodations for mothers. Federal
law should protect life and promote pro-family policies. Current law, the
Pregnancy Discrimination Act,’ provides nondiscrimination protections
in the workplace for pregnancy, childbirth, or related medical conditions.
The Pregnant Workers Fairness Act (PWFA)* requires employers to make
reasonable accommodations for women “to the known limitations related
to the pregnancy, childbirth, or related medical conditions,” unless “the
accommodation would impose an undue hardship on the operation of

the [employer’s] business.” The Americans with Disabilities Act (ADA)
also provides nondiscrimination and accommodation protections in the
workplace for certain pregnancy-related disability.® None of these laws
requires an employer provide health insurance benefits for elective abortion.

Pass a law requiring equal (or greater) benefits for pro-life support
for mothers and clarifying abortion exclusions. Congress should pass a
law requiring that to the extent an employer provides employee benefits for
abortion, it must provide equal or greater benefits for pregnancy, childbirth,
maternity, and adoption. That law should also clarify that no employer is
required to provide any accommodations or benefits for abortion.

Keep anti-life “benefits” out of benefit plans. Some benefits attorneys
and pro-choice advocates have argued since the Supreme Court’s Dobbs

v. Jackson Women’s Health Organization decision® that the longstanding
doctrine of Employee Retirement Income Security Act of 1974 (ERISA)’
preemption should block individual states’ efforts to prohibit employers
from helping employees procure abortions via offering various kinds of
coverage under employee-sponsored benefit plans. ERISA should not be
allowed to trump states’ ability to protect innocent human life in the womb.
Congress and DOL should clarify that ERISA does not preempt states’
power to restrict abortion, surrogacy, or other anti-life “benefits.”

RELIGION

Provide robust protections for religious employers. America’s religious
diversity means that workplaces include people of many faiths and that
many employers are faith-based. Nevertheless, the Biden Administration
has been hostile to people of faith, especially those with traditional beliefs

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Mandate for Leadership: The Conservative Promise

about marriage, gender, and sexuality. The new Administration should
enact policies with robust respect for religious exercise in the workplace,
including under the First Amendment, the Religious Freedom Restoration
Act of 1993 (RFRA),° Title VII, and federal conscience protection laws.

e Issue an executive order protecting religious employers and
employees. The President should make clear via executive order that
religious employers are free to run their businesses according to their
religious beliefs, general nondiscrimination laws notwithstanding, and
support participation of religious employees and employers as federal
contractors and in federal activities and programs.

e §6Clarify Title VII’s religious organization exemptions. Congress should
clarify Title VII’s religious organization exemptions to make it more explicit
that those employers may make employment decisions based on religion
regardless of nondiscrimination laws.

e Provide Robust Accommodations for Religious Employees. Title VII
requires reasonable accommodations for an employee’s sincerely held
religious beliefs, observances, or practices unless it poses an undue hardship
on the employer’s business. These accommodation protections also apply to
issues related to marriage, gender, and sexuality.

Unless the Supreme Court overrules its bad precedent, Congress should
clarify that undue hardship means “significant difficulty or expenses,” not
“more than a de minimis cost” as the Court has previously held.

General EEOC Reforms. The Equal Employment Opportunity Commis-
sion (EEOC) does not have rulemaking authority under Title VII and other

laws it enforces, yet it issues “guidance,” “technical assistance,” and other
documents, including some that push new policy positions. EEOC should
disclaim its regulatory pretensions and abide by the guidance reforms dis-

cussed below.

e EEOC should disclaim its regulatory pretensions.

e Affirm decision-making via majority vote of Commissioners. EEOC
should affirm as policy the Title VII requirement that it exercise substantive

power via majority vote of Commissioners, not by unilateral Chair action or
by delegation to staff.

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2025 Presidential Transition Project

e Disclaim power to enter into consent decrees. EEOC should disclaim
power to enter into consent decrees that require employer actions that it
could not require under the laws it enforces.

e Reorient enforcement priorities. EEOC should reorient its enforcement
priorities toward claims of failure to accommodate disability, religion, and
pregnancy (but not abortion).

Refocusing Labor Regulation on the Good of the Family. The DEI revo-
lution in labor affected not only the administrative state, but it has also targeted
much of the private sector. Owing to the combination of regulatory pressure and
eager human resources offices in the private sector, much of American labor and
employment policy has become institutionally oriented toward “woke” goals.
Retracting regulations that support this revolution is a good first step, but more
is needed. We must replace “woke” nonsense with a healthy vision of the role of
labor policy in our society, starting with the American family.

e Allow workers to accumulate paid time off. Lower- and middle-income
workers are more likely be in jobs that are subject to overtime laws that require
employers to pay time-and-a-half for working more than 40 hours a week.

e Congress should enact the Working Families Flexibility Act. The
Working Families Flexibility Act would allow employees in the private
sector the ability to choose between receiving time-and-a-half pay or
accumulating time-and-a-half paid time off (a choice that many public
sector workers already have). For example, if an individual worked two
hours of overtime every week for a year, he or she could accumulate four
weeks of paid time off to use for paid family leave, vacation, or any reason.

e Congress should incentivize on-site childcare. Across the spectrum of
professionalized childcare options, on-site care puts the least stress on the
parent-child bond.

e Congress should amend the Fair Labor Standards Act (FLSA) to
clarify that an employer’s expenses in providing on-site childcare are
not part of an employee’s regular rate of pay.

e DOL should commit to honest study of the challenges for women
in the world of professional work. The Women’s Bureau at DOL
tends towards a politicized research and engagement agenda that puts
predetermined conclusions ahead of empirical study.

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Mandate for Leadership: The Conservative Promise

e The Bureau should rededicate its research budget towards open
inquiry, especially to disentangle the influences on women’s
workforce participation and to understand the true causes of
earnings gaps between men and women.

e Equalize retirement savings access across married households. The
limit on individual contributions to a 401(k), 403(b), or similar work-based
retirement account is $22,500 for 2023. Individuals who do not work or do
not have access to a work-based retirement account can save up to $6,500
in an IRA. This individual-based system creates a disadvantage for married
couples with only one spouse who works (or with two working spouses, one
of whom earns less than the maximum retirement account contribution).

e To equalize access to tax-free retirement savings for married
couples, the limit for married couples on 401(k) and similar work-
based retirement savings accounts should be double the limit for
individuals, regardless of the allocation of work between the couple.

Family Statistics. Every month, DOL’s Bureau of Labor Statistics surveys tens
of thousands of households to generate detailed estimates of labor market condi-
tions and price levels. And every quarter, the Department of Commerce’s Bureau
of Economic Analysis estimates the change in the entire economy’s output to the
fraction of a percentage point. Yet data on the state of the American family and its
economic welfare are released at best annually, and generally a year or more after
the fact. Metrics like marriage and fertility rates, the share of children living with
both biological parents, the cost of a standard basket of middle-class essentials,
and the share of families whose highest-income worker earns more than twice the
poverty threshold should be measured and reported monthly and in real-time and
incorporated in releases for other labor statistics.

e Congress should establish an Assistant Commissioner for Family
Statistics within the Bureau of Labor Statistics.

e Congress should require the Bureau to establish a pilot survey
with a sample comparable to the BLS Current Population Survey
that would publish monthly estimates for measures of the
American family’s wellbeing, and appropriate sufficient funds for
that purpose.

e Congress should require that the Consumer Price Index market
basket include measurable family-essential goods.

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2025 Presidential Transition Project

Alternative View. While metrics on the state of American families and civil soci-
ety are important and useful, monthly statistics would be of little additional value
and could end up causing unnecessary confusion and concern. Funding should be
oriented towards improving the timeliness of annual family statistics.

Sabbath Rest. God ordained the Sabbath as a day of rest, and until very recently
the Judeo-Christian tradition sought to honor that mandate by moral and legal
regulation of work on that day. Moreover, a shared day off makes it possible for
families and communities to enjoy time off together, rather than as atomized
individuals, and provides a healthier cadence of life for everyone. Unfortunately,
that communal day of rest has eroded under the pressures of consumerism and
secularism, especially for low-income workers.

e Congress should encourage communal rest by amending the Fair
Labor Standards Act (FLSA)? to require that workers be paid time and
a half for hours worked on the Sabbath. That day would default to Sunday,
except for employers with a sincere religious observance of a Sabbath at a
different time (e.g., Friday sundown to Saturday sundown); the obligation
would transfer to that period instead. Houses of worship (to the limited
extent they may have FLSA-covered employees) and employers legally
required to operate around the clock (such as hospitals and first responders)
would be exempt, as would workers otherwise exempt from overtime.

Alternative View. While some conservatives believe that the government should
encourage certain religious observance by making it more expensive for employers
and consumers to not partake in those observances, other conservatives believe
that the government's role is to protect the free exercise of religion by eliminating
barriers as opposed to erecting them. Whereas imposing overtime rules on the Sab-
bath would lead to higher costs and limited access to goods and services and reduce
work available on the Sabbath (while also incentivizing some people—through
higher wages—to desire to work on the Sabbath), the proper role of government
in helping to enable individuals to practice their religion is to reduce barriers to
work options and to fruitful employer and employee relations. The result: ample
job options that do not require work on the Sabbath so that individuals in roles
that sometimes do require Sabbath work are empowered to negotiate directly with
their employer to achieve their desired schedule.

Teleworking. COVID made telework ubiquitous, but the law and regulations
are still stuck in an era when telework was unique.

e Congress should clarify that overtime for telework applies only if the

employee exceeds 10 hours of work in a specific day (and the total
hours for the week exceed 40).

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Mandate for Leadership: The Conservative Promise

e DOL should clarify that an employee given the option to telework
need only record time if the quantity of work assigned for that day
exceeds the usual amount of work that employee performs so that
the employee need not track every time he logs in and out and the
employer need not do so either.

e DOL should clarify that a home office is not subject to OSHA
regulations and that time to set up a home office is not compensable
time or eligible for overtime calculations. DOL should likewise
clarify that reimbursement for home office expenses is not part of an
employee’s regular rate, even if those reimbursements are repetitive
(such as for internet or cell phone service).

Making Family- Sustaining Work Accessible. Our national work ethic is an
American hallmark. As Benjamin Franklin once said, “America is the land of labor.”
Much of American life is mediated by Americans coming together to take responsi-
bility for solving problems and helping their communities. Our labor agenda must
allow community institutions, including small businesses, schools and universities,
religious organizations, and worker organizations, to thrive.

Protect flexible work options and worker independence (independent contractors).
Roughly 60 million Americans across all income groups, ages, education levels,
races, and household types participate in independent work, including full-time,
part-time, or as a “side hustle.” People choose independent work for a variety of
reasons, including flexibility, earnings potential, and the desire to be one’s own boss.
An economic analysis of data from one million Uber drivers found that they valued
the flexibility of the platform at 40 percent of their earnings, and the average Uber
driver would not work at all if he or she had to submit to a taxi-cab schedule. The
value of flexibility extends beyond ride-sharing and other platform work; more
than half of people who did independent work in 2021 said they cannot work a
traditional job because of personal or family circumstances such as their health
or caring for a child or family member.

Independent workers, or contractors, are also critical to entrepreneurship
and small-business growth and success. On average, employers with four or fewer
employees rely on seven contractors to run their business. Without the ability to
hire those contractors, many small businesses could not compete with larger ones
that can afford to employ workers in-house.

Businesses and workers currently must navigate many different definitions
of who is and who is not an employee (or an independent contractor) based on
federal and state employment, compensation, tort, tax, and pension laws. This
complexity often leads to confusion, improper classification, and costly litigation.
The Trump Administration finalized rules to provide clarity on which workers

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2025 Presidential Transition Project

qualify as an independent contractor or employee under the FLSA and NLRA. The
Biden Administration is replacing those rules with vague and expansive definitions
that would add uncertainty, increase costs, and reduce options for Americans who
want to work independently.

e NLRB and DOL should return to their 2019 and 2021 independent
contractor rules that provided much-needed clarity for workers
and employers.

e Congress should establish a bright-line test—based on the level of
control an individual exercises over his or her work—to determine
whether a payee is an employee or an independent contractor, across
all relevant laws. This would prevent continued uncertainty as well as
provide continuity across federal laws.

e Congress should provide a safe harbor from employer-employee status
for companies that offer independent workers access to earned benefits.
Doing so would increase access among independent contractors to traditional
pooled workplace benefits such as health care and retirement savings accounts.

Protect Small Businesses and Entrepreneurship (Joint Employer). Millions of busi-
nesses across America engage in mutually beneficial affiliation arrangements with
other businesses. These arrangements include janitorial services, staffing firms,
construction contractors and subcontractors, technology support services, and
many other vendor and contracting services. They also include the nearly 775,000
independently owned franchise businesses, which employ 8.2 million workers
across the United States. The franchise structure offers a proven business model for
individuals who want to own and operate their own small business. An Obama-era
regulation changed the definition of a joint employer to make corporate franchi-
sors jointly liable for employees of individual franchisee owners, even without the
franchisor exercising any direct control over those employees. The Biden Admin-
istration is advancing an even more expansive definition of a joint employer that
would upend the franchise business model, taking away ownership and income
opportunities from small-business entrepreneurs, costing jobs, and raising prices.

e DOL and NLBB should return to the long-standing approach to
defining joint employers based on direct and immediate control.

e Congress should enact the Save Local Business Act, which would

codify the long-standing definition that has existed outside the
Obama-era and Biden-proposed rules.

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Mandate for Leadership: The Conservative Promise

Overtime Pay Threshold. Overtime pay is one of the most challenging aspects
of the Fair Labor Standards Act rules. “Nonexempt workers” (e.g., workers whose
job duties fall within the law’s power or whose total pay is low enough) must be
paid overtime (150 percent of the “regular rate”) for every hour over 40 in a work-
week. Overtime requirements may discourage employers from offering certain
fringe benefits such as reimbursement for education, childcare, or even free meals
because the benefits’ value may be included in the “regular rate” that must be
paid at 150 percent for all overtime hours. And because some of these fringe ben-
efits may be more valuable (and often come with tax preferences that benefit the
worker), the goal should be to set a threshold to ensure lower-income workers have
the protections of overtime pay without discouraging employers from offering
these benefits.

e DOL should maintain an overtime threshold that does not punish
businesses in lower-cost regions (e.g., the southeast United
States). The Trump-era threshold is high enough to capture most
line workers in lower-cost regions. One possibility to consider (likely
requiring congressional action) would be to automatically update the
thresholds every five years using the Personal Consumption Expenditures
(PCE) as an inflation adjustment. This could reduce the likelihood of
a future Administration attempting to make significant changes but
would also impose more adjustments on businesses as those automatic
increases take hold.

e Congress should clarify that the “regular rate” for overtime pay is
based on the salary paid rather than all benefits provided. This would
enable employers to offer additional benefits to employees without fear that
those benefits would dramatically increase overtime pay.

e Congress should provide flexibility to employers and employees
to calculate the overtime period over a longer number of weeks.
Specifically, employers and employees should be able to set a two- or four-
week period over which to calculate overtime. This would give workers
greater flexibility to work more hours in one week and fewer hours in the
next and would not require the employer to pay them more for that same
total number of hours of work during the entire period.

Compliance-Assistance Programming. Labor agencies are often tempted to
encourage “over compliance” by companies subject to regulation by pursuing
“regulation through enforcement” strategies. Rather than giving regulated enti-
ties clear boundaries for what they can and cannot do under the law, the agencies

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2025 Presidential Transition Project

rely on the vagueness of the law to bring enforcement activity against businesses

that fail to meet an inspector or agency head’s personal standard. This is not fair

to regulated parties and results in disfavored companies bearing the brunt of the

agencies’ enforcement efforts even though their behavior may be within the main-
stream of employer behavior.

e Labor agencies should provide compliance assistance to help
businesses and workers better understand the agencies’ position
on their own rules and should do so in a way that makes it easier
to follow those rules. This frees people to focus on their work rather
than slogging through an ever-growing body of laws, rules, and guidance
documents generated by the agencies.

Clear and Restrictive Rules on Guidance Documents. Federal agencies not only
issue regulations to fill in gaps left by legislation, but also supplement those reg-
ulations with “guidance” documents that occupy a unique and often confusing
area between law and “helpful advice.” Unfortunately, wielded by overzealous
enforcement agents, such guidance, some of it even hidden from public view,
morphs into binding law used against unsuspecting employers. Guidance can be
a tricky thing and can be used for good or bad. It should be used to make compli-
cated regulations easier to understand, so that businesses can do their actual jobs
and focus on providing jobs to American workers and value to consumers (really,
compliance assistance). But guidance is often used to create new rules overnight
without following legal requirements—like giving the public an opportunity to
provide valuable input. This wrongful use of guidance hurts workers and those
who employ them. In October 2019, President Trump signed an executive order
ending this abusive practice and created a new, fairer system for American busi-
nesses and their employees. In response, DOL published its PRO Good Guidance
rule,'° which expressly limits its use of guidance in enforcement actions and gives
the public the opportunity to submit comments to influence the department’s deci-
sions on creating, revising, and even rescinding guidance. Under this rule, agencies
cannot treat guidance as legally binding and must make all guidance documents
readily accessible on their searchable online databases. This rule was immediately
rescinded by the Biden Administration.

e DOL should reinstitute the PRO Good Guidance rule via notice
and comment.

e Congress should amend the Administrative Procedure Act" to
explicitly limit the use of guidance documents.

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Exemptions from Regulations for Small Business. Burdensome regulations have
anti-competitive effects. In general, larger, higher-margin businesses are better
able to absorb the costs of regulatory compliance than are small businesses, and
under the Biden Administration, big-business lobbies have affirmatively embraced
certain regulations (such as the COVID vaccine mandate for private employers) to
reduce competition from smaller businesses. Research suggests that labor regula-
tions may pose the highest aggregate regulatory cost for small businesses.

e The labor agencies should exercise their available discretion and
duties under the Regulatory Flexibility Act” to exempt small entities
from regulations where possible.

e Congress should enact legislation increasing the revenue thresholds
at which the National Labor Relations Board asserts jurisdiction over
employers to match changes in inflation that have occurred since
1935 and better reflect the definition of “small business” used by the
federal government.

e Congress (and DOL, in its enforcement discretion) should exempt
small business, first-time, non-willful violators from fines issued by
the Occupational Health and Safety Administration.

EDUCATION AND VOCATIONAL TRAINING

Apprenticeships. The next Administration should return to prior policy and
implement an industry-recognized apprenticeship program separate from the
Registered Apprenticeship Program (RAP) and explore how best to modernize,
streamline, and eliminate duplication in the RAP. For roughly 80 years, the RAP—
which requires conforming to government standards and includes federal funding,
tax credits, and other federal resources—has dominated apprenticeship programs
in the U.S. Organizations across the political spectrum have noted that the overly
burdensome requirements of RAPs have contributed to limiting them to legacy
trades, failing to meet growing industry demands such as in health care and tech-
nology. A 2017 study estimated that the number of occupations commonly filled
through apprenticeships could nearly triple (from 27 to 74), that the number of
job openings filled through apprenticeships could expand eightfold (to 3.2 million),
and that the occupations ripe for apprenticeship expansion could offer 20 percent
higher wages than traditional apprenticeship occupations.

The Trump Administration expanded apprenticeship options through the cre-
ation of the Industry-Recognized Apprenticeship Program (IRAP), and more than
130 IRAPs were created. The Biden Administration rescinded the IRAP regulations.

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e Congress should expand apprenticeship programs outside of the RAP
model, re-creating the IRAP system by statute and allowing approved
entities such as trade associations and educational institutions to
recognize and oversee apprenticeship programs.

In addition, religious organizations should be encouraged to participate

in apprenticeship programs. America has a long history of religious
organizations working to advance the dignity of workers and provide

them with greater opportunity, from the many prominent Christian and
Jewish voices in the early labor movement to the “labor priests” who would
appear on picket lines to support their flocks. Today, the role of religion in
helping workers has diminished, but a country committed to strengthening
civil society must ask more from religious organizations and make sure
that their important role is not impeded by regulatory roadblocks or the
bureaucratic status quo.

e Encourage and enable religious organizations to participate in
apprenticeship programs, etc. Both DOL and NLBB should facilitate
religious organizations helping to strengthen working families via
apprenticeship programs, worker organizations, vocational training,
benefits networks, etc.

Hazard-Order Regulations. Some young adults show an interest in inherently
dangerous jobs. Current rules forbid many young people, even if their family is
running the business, from working in such jobs. This results in worker shortages
in dangerous fields and often discourages otherwise interested young workers from
trying the more dangerous job. With parental consent and proper training, certain
young adults should be allowed to learn and work in more dangerous occupations.
This would give a green light to training programs and build skills in teenagers who
may want to work in these fields.

e DOL should amend its hazard-order regulations to permit teenage
workers access to work in regulated jobs with proper training and
parental consent.

Workforce Training Grant Program. The federal government spends more
than $100 billion per year subsidizing higher education but close to zero supporting

people on non-college pathways.

e Congress should create an employer grant worth up to $10,000
per year or pro-rated portion thereof for each worker engaged in

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on-the-job training, defined as some share of paid time spent ina
formal training program.

To qualify, a program—whether run by the employer, an industry
consortium, a community college, or a union—would need to define program
length, curriculum, career path, and credential and to report regularly on
outcomes for participants. Programs that fail to deliver promised results
would be disqualified from continued funding. Funding for employer grants
should come from existing higher education subsidies that are currently
disadvantaging alternative education options.

Federal “BA Box.” The American labor market continues to experience a glut
of college degrees. The country produces more college graduates than suitable jobs
for them to fill. Meanwhile, employers exacerbate the problem, fueling demand
for college by needlessly requiring degrees for many jobs. In 2020, the Trump
Administration took an important step toward pro-worker, skills-based hiring
practices. Executive Order 13932, Modernizing and Reforming the Assessment and
Hiring of Federal Job Candidates,” directed the Office of Personnel Management
to reduce degree-based practices in the federal civil service. Maryland’s Governor
Larry Hogan issued an executive order in 2022 to adopt this rule for Maryland state
employees, and Utah’s Governor Spencer Cox in December of 2022 announced
that Utah would do the same. Today, federal civil service job descriptions must

“be based on the specific skills and competencies required to perform those jobs,”
and may prescribe a “minimum educational requirement” only if it is otherwise
legally required. The same policies do not extend beyond the civil service. Federal
agencies continue to require college degrees for contract employees, and federal
contractors are rarely able to place workers without four-year degrees on federal
projects, regardless of their qualifications. Private employers consistently impose
a BA requirement on jobs even when existing workers in the role do not have one.

e Adopt the civil service’s skills-based hiring standards for federal
contractors. The President should direct the Administrator for Federal
Procurement Policy to adopt the civil service’s skills-based hiring standards
for federal contractors and issue waivers from degree-based staffing
requirements in existing contracts.

e Prohibit the use of a BA requirement in job descriptions. Congress
should prohibit the inclusion of a BA requirement in job descriptions
for all private sector employers, or the use of a BA requirement to screen
applicants using algorithms, except where a BA from a particular type of
institution or in a particular field is a bona fide requirement of the position.

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Alternative View. While the federal government has a duty to promote economy
and efficiency in federal hiring and contracting, and thus should base decisions on
skills as opposed to degrees, it is not the federal government’s role to determine
whether private employers may or may not include degree requirements in job
descriptions and in their hiring decisions. The inappropriate reverence given to
degree requirements is a byproduct of the federal government’s heavy subsidi-
zation of BA degrees. Phasing down federal subsidies would be a better way to
eliminate barriers to jobs for individuals without BA degrees.

Federal Workforce Development Programs. Existing federally funded work-
force development and training programs should be reassessed to ensure they are
outcome-based and truly deliver value to taxpayers and job seekers.

As of 2019, the federal government spent approximately $17 billion annually on
43 federal employment and training programs administered across nine federal
agencies, many of which overlap with at least one other program. Many of these
programs track only inputs or individuals served, not outcomes or outputs, and do
not swiftly identify bad-actor grantees. The federal government should identify
underperforming programs and eliminate or redirect that funding to programs
with strong outcome-based metrics.

e Evaluate and streamline workforce development programs, ensuring
evidence-based outcomes. In its reauthorization of the Workforce
Innovation and Opportunity Act (WIOA)," Congress should evaluate and
streamline the existing workforce development programs to ensure there
is no overlap or fragmentation between programs. Congress should also
ensure strong evidence-based outcomes for each program and tie federal
funding for those programs to the outcomes achieved.

e Review employment and training programs to ensure outcome-
based metrics. DOL and other federal agencies with jurisdiction over
employment and training programs should review their programs and
utilize all available tools and authority to ensure these programs contain
strong outcome-based metrics. To the extent that agencies have this
authority, they should reevaluate funding for programs that do not meet
those evidence-based and outcomes-based requirements. Finally, strong
internal policies should be implemented to ensure bad-actor grantees are
identified and sanctioned expeditiously.

Federal Unemployment Insurance Program. In the post-pandemic land-
scape, the federal government should restore the Unemployment Insurance (UI)
program’s purpose with a particular focus on reestablishing program integrity and
accountability. The Coronavirus Aid, Relief, and Economic Security (CARES) Act®

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unemployment programs were defrauded of hundreds of billions of dollars, includ-
ing by state-sponsored hacking groups. Not all state agencies are yet through their

backlogs of appeals and fraud cases; the recovery of lost funds has been minimal;

and fraud has now spilled into the traditional UI programs. The CARES Act era

drastically altered the entire UI ecosystem: The federal-state partnership shifted

toward federal programs and funding, and the social insurance purpose of the

program was disconnected as benefits were extended, expanded to more typically
uncovered populations, and made exponentially larger.

e Congress should enact bipartisan commonsense UI program reforms,
including statutory authority for the Labor Office of Inspector
General (OIG) to access all state UI records for the purposes of
investigation and requiring state agencies to crossmatch applicants
with the National Directory of New Hires.

e Congress should also develop a framework (through commission of a
congressional report to serve as a blueprint) of technical standards
on broader tech topics like usability, state agency cybersecurity
postures, data taxonomy standardization, and/or identity
verification standards.

e Congress should provide DOL with more reasonable enforcement
tools for the UI system. Currently, DOL can either send a strongly worded
letter or revoke the entire Federal Unemployment Tax Act (FUTA)”* tax
credit, which would place an immediate 6 percent to 7 percent tax on all
covered employers.

e DOL should review all actual or planned procurements against
the $2 billion (under the American Rescue Plan Act)” for UI fraud
detection, accessibility, and equity investments. These funds do not
have appropriations timelines and have very minimal statutory descriptions
of the intended purpose. DOL should also review and propose changes to
improve state monitoring programs including developing evidence-based
frameworks for evaluating the technical readiness and security postures of
the state agencies; strengthen its relationship with the OIG and Government
Accountability Office (GAO), and support continued development of fraud
prosecution with DOJ, the Department of Homeland Security (DHS), and
the financial services community; ensure administrative and IT funding is
outcome-based; and gather and publish best practices from state officials,
industry partners, and other vendors who deliver UI services.

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WORKER VOICE AND COLLECTIVE BARGAINING

Non-Union Worker Voice and Representation. American workers lack a
meaningful voice in today’s workplace. Between 50 percent and 60 percent of
workers have less influence than they want on critical workplaces issues beyond
pay and benefits. Even managers are twice as likely to say their employees have
too little influence rather than too much. But America’s one-size-fits-all approach
undermines worker representation. Federal labor law offers no alternatives to
labor unions whose politicking and adversarial approach appeals to few, whereas
most workers report that they prefer a more cooperative model run jointly with
management that focuses solely on workplace issues. The next Administration
should make new options available to workers and push Congress to pass labor
reforms that create non-union “employee involvement organizations” as well as
a mechanism for worker representation on corporate boards.

e Congress should reintroduce and pass the Teamwork for Employees
and Managers (TEAM) Act of 2022." The TEAM Act:

1. Reforms the National Labor Relations Act’s (NLRA) Section 8(a) (2)
prohibition on formal worker-management cooperative organizations
like works councils.

2. Creates an “Employee Involvement Organization” (EIO) to facilitate
voluntary cooperation on critical issues like working conditions,
benefits, and productivity.

3. Amends labor law to allow EIOs at large, publicly traded corporations
to elect a non-voting, supervisory member of their company’s board
of directors.

Alternative View. While some conservatives lament that workers lack sufficient
voice in today’s workplace, others interpret the rise in independent and flexible
work opportunities, significant expansion in family-friendly policies like paid
family leave, and the decline in private sector unionization as indicators of workers’
increasing competency and control. Another way to help expand workers’ freedom
and voices in traditional workplaces is by allowing them to choose who represents
them in negotiations with their employer. The Worker’s Choice Act”? would accom-
plish this by ending exclusive representation so that unions in right-to-work states
are no longer forced to represent workers who do not want to join them.

Union Transparency. Private-sector unions must file detailed financial infor-
mation with DOL—on matters including union spending, income, loans, assets,
membership information, and employee salary—but unions composed entirely

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of state or local employees are exempt from this filing requirement. These dis-
closure requirements help workers and the public understand how union leaders
are raising and spending union dues; they also can serve as a vital source of infor-
mation that helps workers decide if the unions they are asked to join are good
stewards of the funds they collect. DOL, under both George W. Bush and Donald
Trump, tried rulemakings (known as the Intermediate Bodies Rule) that would
require some government unions to file the same information that is required of
private-sector unions.

Under President Trump, OLMS required unions to disclose involvement in
trusts that they either own a majority stake in or control. In the past, union trust
spending has been hidden, and it appears that trust assets have occasionally
been corruptly spent for the benefit of private interests in union leadership—
such as $30,000 spent on a private party, $37,500 spent on a Montblanc pen,
condominiums for those in power, golf outings, and a Ferrari.?° But the Biden
DOL eliminated a transparency rule requiring the filing of the T-1 Trust
Annual Report.

More generally, OLMS, which is charged with enforcing the law of union dis-
closure, has historically been underfunded when compared to other DOL agencies.
This relative lack of funding has made ensuring disclosure more difficult.

e Enact transparency rules. The substance of the Intermediate Bodies Rule
should pass into law, either through rulemaking or through legislation. The
T-1 Trust Annual Report annual filing requirement should be restored.

e Increase funding levels. Congress should expand the funding of the Office
of Labor-Management Standards.

Duty of Fair Representation. Unions have a duty of fair representation to
their members, yet they too often abuse that duty to use their members’ resources
on left-wing culture-war issues that are unrelated, and in fact often harmful, to
union members’ own interests.

e The NLBB should take enforcement or amicus action advancing the
position that political conflicts of interest by union leadership can
support claims for breach of the duty of fair representation ina
manner analogous to financial conflicts of interest and analogous to
breaches of the fiduciary duty of loyalty in other areas of law.

Interpreting “Protected Concerted Activity.” In an effort to prevent

employers from retaliating against workers who express a desire to unionize, cer-
tain activities are deemed “protected concerted activity” (under 87 of the NLRA).

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The NLRB has issued extreme interpretations of these activities, such as deter-
mining that a business’s requiring its employees to be courteous to customers and

one another is an unlawful infringement on the free speech rights implicit in the

protected concerted activity protections in the NLRA.

e Reverse unreasonable interpretations of “protected concerted
activity.” The NLRB should return to the 2019 Alstate Maintenance
interpretation of what does and does not constitute protected concerted
activity, including listing eight instances of lawful actions by employers.

Injunctive Relief and Worker Organizing Activities. Within the confines
of the more reasonable definition of protected concerted activity described above,
the NLRB should increase its pursuit of reinstatement injunctions. Firing work-
ers engaged in concerted activity has an immediate chilling effect on organizing,
but remedies under the NLRA typically come only much later and amount only
to backpay. In NLRA section 10(j), Congress empowered the NLRB to obtain
temporary injunctions that immediately reinstate workers to their jobs in these
circumstances. This provides a more meaningful remedy to the worker and creates
asignificant deterrent to unfair labor practices, because prompt reinstatement will
tend to reinforce the legitimacy of the organizing effort. The NLRB overwhelmingly
prevails when pursuing an injunction, succeeding 100 percent of the time in 2020
and 91 percent of the time in 2021.

e Increase the use of 10(j) injunctive relief. The NLRB should increase
its use of 10(j) and should articulate guidelines for situations in which it
intends to seek injunctive relief; the board should delegate authority to
pursue such injunctions to the general counsel and the general counsel
should establish a policy of considering them expeditiously in all retaliation
cases identified by regional offices.

Dues-Funded Worker Centers. Under current law, both labor unions and
unionized employers must file financial disclosures with DOL on an annual basis
to ward off potential fraud and corruption of the sort that has been seen recently
within the United Automobile, Aerospace and Agricultural Implement Workers of
America (UAW). However, worker centers, which have grown in number and influ-
ence enormously over the past decade, are not required to file these disclosures.

e Investigate worker centers and require financial disclosures. DOL

should investigate worker centers that look and act like unions and bring
enforcement actions to require them to file the same financial disclosures.

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Office of Labor-Management Standards Initiative. Currently, the Office of
Labor-Management Standards (OLMS) may investigate potential employer mal-
feasance with regard to union funds in the absence of any complaint by a worker
or union but may not do the same with regard to potential union malfeasance. If
OLMS has evidence that a union may be violating the law based on information
available to the agency (such as annual financial disclosure reports, information
developed during an audit of a union’s books and records, or information obtained
from other government agencies) it should be permitted to open an investigation.
It should have the same enforcement tools available for both employers and unions.

e Revise investigation standards. The Office of Labor-Management
Standards should revise its investigation standards to authorize
investigations without receiving a formal complaint.

Persuader Rule. During the Obama Administration, DOL created significant
regulatory burdens for employers with respect to the advice that employers receive
about union activity. As a general matter, employers who hire lawyers or other con-
sultants to advise employees about union issues must file disclosure forms with the
department, as must the lawyers and consultants themselves. Prior to the Obama
Administration, advice provided solely to the employer required no disclosure.
The Obama Administration attempted to eliminate this “advice exemption” with
a directive known as the “persuader rule,” which was successfully challenged in
court. In 2018, the Trump Administration formally rescinded the persuader rule.

e DOL should rescind the persuader rule once again should the Biden
Administration revive it.

Unionizing the Workplace: Card Check vs. Secret Ballot. Under the
NLRA, instead of having a secret ballot election about the decision to unionize
a workplace, a union may instead collect signed pro-union cards from a majority
of the employees it wishes to represent and then ask the employer and National
Labor Relations Board for voluntary union recognition. That request gives the
employer the option to hold a secret-ballot election or to recognize the union with-
out any such election. This “card check” procedure is likely to induce employees
to provide their signed cards in ways that do not accurately reflect their true pref-
erences—ranging from a desire not to offend the signature requestor to a wish to
avoid intimidation and coercion to signing based on false information provided
by union organizers. In short, the card check procedure sidesteps many aspects of
democratic decision-making that free and fair elections conducted by secret ballot
are supposed to accomplish. Notably, the general counsel of the National Labor
Relations Board has recently proposed an esoteric legal theory that card-check

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decision-making is required under the law, basing this theory on an old NLRB
case, Joy Silk, even though the Supreme Court has repeatedly rejected mandatory
card-check recognition.

e Discard “card check.” Congress should discard “card check” as the basis of
union recognition and mandate the secret ballot exclusively.

Contract Bar Rule. Although current labor law allows a union to establish itself
at a workplace at more or less any time, the calendar for any attempt to decertify
a union is considerably more constrained. If a union is recognized as a collective
bargaining agent, then employees may not decertify it or substitute another union
for it for at least one year under federal law (the “certification bar”). Similarly, when
aunion reaches a collective bargaining agreement with an employer, it is immune
from a decertification election for up to three years (the “contract bar”). A typical
consequence of these rules is that employees must often wait four years before
they are allowed a chance at decertification. Employees then have only a 45-day
window to file a decertification petition; ifthe employer and union sign a successor
contract, then the contract bar comes into play once again—meaning employees
with an interest in decertification must wait another three years.

e Eliminate the contract bar rule. NLRB should eliminate the contract bar
rule so that employees with an interest in decertification have a reasonable
chance to achieve their goal.

Tailoring National Employment Rules. National employment laws like
the Fair Labor Standards Act (FLSA)?! and the Occupational Safety and Health
(OSH) Act” set out one-size-fits-all “floors” regulating the employment rela-
tionship. These substantive worker protections often do not mesh well with the
procedural worker protections offered through the NLRA’s collective bargaining
process. Unions could play a powerful role in tailoring national employment rules
to the needs of a particular workplace if, in unionized workplaces, national rules
were treated as negotiable defaults rather than non-negotiable floors.

e Congress should amend the NLRA to authorize collective bargaining
to treat national employment laws and regulations as negotiable
defaults. For example, this reform would allow a union to bless a relaxed
overtime trigger (e.g., 45 hours a week, or 80 hours over two weeks) in
exchange for firm employer commitments on predictable scheduling.

Alternative Policy. While some conservatives (including the author of this chap-
ter) believe that it would be a mistake to antagonize unions’ core interests, others

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argue that the next Administration should end Project Labor Agreement require-
ments and repeal the Davis—Bacon Act. And while some conservatives have chosen
not to address massive federal subsidies for unionized labor, others believe that
current laws and regulations that pick winners and losers to the detriment of the
majority of construction workers and to all taxpayers should not be ignored.

Project Labor Agreements (PLAs) are short-term collective bargaining
agreements that apply to construction projects. There are a few reasons that con-
struction projects may benefit from a PLA, and there are many reasons that even
when actively encouraged to do so public construction projects have declined
to use PLAs. Among the consequences: The majority of construction firms and
construction workers are not unionized and their temporary forced unionization
results in large-scale wage theft; construction companies are significantly less
likely to bid on projects with PLAs; and PLAs consistently drive up construction
costs by 10 percent to 30 percent.

The Davis—Bacon Act” requires federally financed construction projects to pay

“prevailing wages.” In theory, these wages should reflect going market rates for

construction labor in the relevant area. However, both the Government Account-
ability Office and the Department of Labor’s Inspector General have repeatedly
criticized the Labor Department for using self-selected, statistically unrepresenta-
tive samples to calculate the prevailing-wage rates that drive up the cost of federal
construction by about 10 percent. The Davis—Bacon Act redistributes wealth from
hardworking Americans to those that benefit from government-funded construc-
tion projects. Repealing the Davis—Bacon Act would increase worker freedom and
end a longstanding effective tax on American families.

e End PLA requirements. Agencies should end all mandatory Project Labor
Agreement requirements and base federal procurement decisions on the
contractors that can deliver the best product at the lowest cost.

e Repeal Davis-Bacon. Congress should enact the Davis—Bacon Repeal Act
and allow markets to determine market wages.

THE STATES

Worker-led Benefits Experimentation. Workers depend on unemployment
benefits to navigate inevitable market frictions and seek new employment oppor-
tunities. But existing unemployment insurance (UI) is bureaucratic, ineffective,
and unaccountable. The outdated system’s myriad failures during the COVID-19
pandemic highlighted the need for innovations that respond to recipients’ needs.

The most promising avenue for innovation is to involve workers and private-sec-
tor organizations more directly, freed from unnecessary bureaucratic strictures.
Americans take for granted that unemployment benefits must be administered by

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government agencies, but other Western market democracies feature effective and
popular benefits administered by non-public worker organizations.

The next conservative Administration should encourage UI innovation by capi-
talizing on a key feature of the system and principle of conservative policymaking:
federalism. State governments already administer unemployment benefits and
have broad discretion over their programs. Existing statutory language in the Social
Security Act” does not prohibit non-public organizations from administering the
program, nor does it specifically authorize states to do so. Further, the Adminis-
tration can replicate state-level experiments in welfare programs and empower
state officials to adapt UI to local conditions and needs.

e Approve non-public worker organizations as UI administrators. DOL
should approve, pursuant to § 303(a)(2) of the Social Security Act, non-
public worker organizations as administrators.

e Offer waivers for suitable alternatives. DOL should offer waivers from
the standard requirements imposed on unemployment compensation by §
303(a) and § 303(d) of the Social Security Act to states that propose suitable
alternatives.

e Require organizations to comply with restrictions on political
spending. DOL should establish as a precondition for receiving any public
funds a requirement that an organization comply with restrictions on
political spending as applied to 501(c)(8) charitable organizations.

Labor Law. The federal laws governing labor-management relations have
barely changed in generations, and reforms on the federal level have been almost
impossible to get through Congress. To modernize labor law, the Congress should:

e Pass legislation allowing waivers for states and local governments.
To encourage experimentation and reform efforts at the state and local
levels, Congress should pass legislation allowing waivers from federal labor
laws like the NLRA and FLSA under certain conditions. State and local
governments seeking waivers would be required to demonstrate that their
reforms would accomplish the purpose of the underlying law, and not take
away any current rights held by workers or employers. In addition, waivers
would be limited to a five-year period, after which time they could be
modified, canceled, or renewed.

Excessive Occupational Regulation. Excessive occupational regulation—
most typically encountered as occupational licensing—creates underemployment

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and wasted resources, and artificially increases consumer prices. It is a significant
problem that is difficult to address at the federal level.

e Congress should ensure that interstate compacts for occupational
license recognition that are federally funded do not require new or
additional qualifications (that is, qualifications that do not originate
from state governments themselves) for licensed professionals to
participate.

e Congress should ensure that well-qualified licensees are not locked
out of the job market by restrictive government programs funded by
the federal government. (For instance, medical doctors must complete
residency training to practice, and because Medicare provides funding for
significantly fewer residencies than there are doctors, sizable numbers of
MDs are locked out of the job market every year.)

Wagner-Peyser Staffing Flexibility. State agencies that administer unem-
ployment benefits and workforce development programs should be able to hire
the best people to do the job and should not be required to use state employees ifa
contractor can do the job better. Further, the federal government should not force
a state to use non-union labor or union labor for these positions.

e DOL should repromulgate the Trump-era staffing flexibility rule, and
Congress should codify it.

WORKER RETIREMENT SAVINGS, ESG,

AND PENSION REFORMS

e Remove ESG considerations from ERISA. Environmental, Social,
Governance (ESG) investing is a relatively recent strategy promoted by
large asset managers that focuses not only on a company’s bottom line, but
also on the company’s compliance with liberal political views on climate
change, racial quotas, abortion, and other issues. The ESG movement has
focused especially on reducing greenhouse gas emissions. For example, ESG
proponents advocate for divestment from oil and gas companies or the
exercise of investor influence to reduce oil and gas production.

ESG considerations unrelated to investor risks and returns necessarily
sacrifice trust law’s traditional sole focus on investment returns for
collateral interests. And while individual investors may prefer to invest

in “green” companies, “woke” companies, or companies with greater board
diversity, and may even be willing to sacrifice some financial gains to do

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so, the question relevant to DOL is whether, and under what conditions,
fiduciaries should be permitted to follow this path as well.

While Americans are free to invest their own savings however they wish,
in ERISA, Congress imposed strict duties on employer-sponsored worker
retirement plans as a prophylactic protection of workers’ retirement
security in general. Recognizing the unique status of employer-managed
retirement savings, in ERISA, Congress required that fiduciaries
exclusively seek the best interests of plan beneficiaries. Because ESG
investing necessarily puts other considerations before the interests of the
beneficiary, ESG investing by plan managers is an inappropriate strategy
under ERISA.

e DOL should prohibit investing in ERISA plans on the basis of any
factors that are unrelated to investor risks and returns.

¢ DOL should return to the Trump Administration’s approach of
permitting only the consideration of pecuniary factors in ERISA.
However, this approach should not preclude the consideration of legitimate
non-ESG factors, such as corporate governance, supply chain investment in
America, or family-supporting jobs.

e DOL should consider taking enforcement and/or regulatory action to
subject investment in China to greater scrutiny under ERISA. Many
large retirement and pension plans remain invested in China despite its
lack of compliance with U.S. accounting standards and state control over all
aspects of private capital.

Alternative View. Some conservatives believe that ERISA plan investments
should be made solely on a pecuniary basis and the consideration of any non-pe-
cuniary factor, ESG or otherwise, should be prohibited. Additionally, other
conservatives believe that even though ESG investing is often not a sound finan-
cial strategy, it is not wrong for retirement plans to offer ESG investment options
so long as individuals explicitly acknowledge and choose to pursue investment
options that do not exclusively maximize pecuniary gains.

Thrift Savings Plan. The Thrift Savings Plan (TSP) is the retirement savings
benefit plan for most federal employees and many former employees. The TSP is
managed by the Federal Retirement Thrift Investment Board (FRTIB). At over
$800 billion in assets under management, the TSP is one of the largest retirement
plans in the world.

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Mandate for Leadership: The Conservative Promise

DOL should reverse efforts to politicize the TSP by removing “mutual
fund” windows that encourage ESG, and should clarify the fiduciary
duties of the TSP. Recent efforts by congressional Democrats and the
Biden Administration to politicize the TSP by offering selective “mutual
fund” windows that encourage ESG should be reversed by DOL, and the
fiduciary duties of the TSP should be clarified by the department to preclude
ESG investments absent individual stock selection by the participant.

The TSP is managed under contract by private-sector fund managers. Its
current managers are BlackRock and State Street Global Advisers. Both of
these managers have demonstrated a public commitment to use the funds
they manage to advance ESG.

The federal government should follow the lead of multiple state
governments in removing their pension funds from fund managers
such as BlackRock and State Street Global Advisers, and contract
with a competitive, private-sector manager that will comply with its
fiduciary duties.

DOL should also consider bringing enforcement actions against
BlackRock and State Street Global Advisers for their violations of
fiduciary duty while managing the TSP.

Congress should enact legislation authorizing the FRTIB to exercise
its independent business judgment in exercising the proxy votes for
its holdings of the TSP and provide clear proxy voting guidelines for
the FRTIB to follow. The current proxy adviser market is dominated by
two firms, Institutional Shareholder Services and Glass Lewis, which use
heavily weighted ESG criteria in directing the proxy votes of pension plans.
If feasible, the new legislation should also offer a streamlined process for
other proxy advisers to compete for the TSP’s business.

As the principal retirement savings plan of America’s servicemen and
women, part of the FRTIB’s fiduciary duties in managing the TSP is a duty
not to invest in governments that are enemies of the United States. Yet the
FRTIB has repeatedly approved the investment of TSP funds in Chinese
military companies and state-owned enterprises. Under the Trump
Administration, DOL ordered the FRTIB to cease investments in China.
However, under the Biden Administration, the TSP has made available a
wide range of investments in China.

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e DOL should exercise its oversight of the FRTIB to prohibit
investments in China.

e Congress should enact legislation prohibiting investment of the
TSP in China.

PENSION REFORMS.

Public Pension Plan Disclosure. Residents of states that responsibly manage
their public pension plans (pension plans for State and local government employ-
ees) should not be responsible for bailing out states that do not do so. Money is
ultimately fungible, so federal aid to States can effectively be used to free up other
State funds for pension contributions. Although the federal government does not
impose funding rules on public pension plans, these plans should be required to
disclose the fair market value of plan assets and liabilities (using the Treasury
yield curve as the discount rate) on an annual basis. In the aggregate, these plans
were underfunded ona market basis by $6.501 trillion as of Fiscal Year (FY) 2021,
even though the plans reported underfunding of only $1.076 trillion using overly
optimistic assumptions.

e Disclose the fair market value of plan assets and liabilities. Congress
should require public pension funds to disclose the fair market value of plan
assets and liabilities (using the Treasury yield curve as the discount rate) on
an annual basis.

Multiemployer Plans. At the request of multiemployer union pension plans,
the government has given such plans much more lenient rules and discretion over
funding than it has given to single-employer plans. Multiemployer plans have been
severely mismanaged, and the plans have abused the discretion and deference given
them by federal law and enforcement agencies to make promises that they cannot
keep. As a result, these plans are generally severely underfunded, with $757 billion
in aggregate underfunding, and a funding level ofjust 42 percent. The Biden Admin-
istration has provided a massive taxpayer bailout to some of these plans, but without
any needed reforms. Even worse, it gave out funds in excess of what the law allows.

e Congress should reform multiemployer pensions to give participants
in these plans the same protections as those in single-employer plans.
Liabilities should be measured similarly to single-employer plans. Workers
should be able to earn benefits at any employer in the plan, but liabilities
should be divided amongst employers, instead of the current illusory
joint and several liability under which no one is ultimately responsible
for making up underfunding. Troubled plans should be prohibited from

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making new pension promises. More timely and detailed reporting
should be imposed.

Pension Benefit Guaranty Corporation. The Pension Benefit Guaranty Cor-
poration (PBGC) insures benefits for private sector pension plans, with separate
single-employer and multiemployer insurance programs.

e The PBGC’s annual report must be submitted on time, and with
timely data that uses fair-market value principles to calculate the
PBGC’s finances. The PBGC has been submitting portions of statutorily
required annual reports many months late and using out-of-date data. And
PBGC'’s data on plans is almost five years old. These problematic practices
make it difficult for Congress to become aware of serious problems in the
insurance programs, which received a bailout of over $85 billion in the 2021
American Rescue Plan Act.

The PBGC should use existing statutory authority to protect workers,
retirees, employers, and taxpayers by closely monitoring and taking
appropriate remedial action with regard to badly run and underfunded
multiemployer union pension plans, including termination where
appropriate. The PBGC’s refusal to use such authority helped cause its
multiemployer program deficit to go from less than $500 million in 2008 to
over $65 billion in 2017.

e Congress should increase the variable rate premium on underfunding
and eliminate the per-participant cap in order to appropriately
take into account risk and limit the degree to which well-funded
pension plans must subsidize underfunded plans. Reforms should
proportionately reduce the fixed per-participant premium to ease the
burden on well-funded plans and also increase premiums on multiemployer
plans to match single-employer plans.

Improving Access to Employee Stock Ownership Plans. Employee Stock
Ownership Plans (ESOPs) are ERISA-covered employee retirement savings
plans that allow employees to receive compensation in the form of equity in their
employer business. These arrangements enable employees to formally partici-
pate as investors in how their employers’ businesses are run. And they also align
employer-employee incentives by giving employees a greater financial stake in the
success of their employers. With over half of small businesses owned by business
owners over the age of 55, ESOPs also create advantageous succession oppor-
tunities that support the continuity of local businesses and regional economic

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development. Finally, ESOPs can enable greater investment returns for employees.
However, ESOPs have to date lacked clear rules under ERISA that recognize their
unique structure and benefits, and this opacity can serve as a barrier to employers
considering adopting ESOPs.

e Provide clear regulations for ESOP valuation and fiduciary conduct.
DOL should make it easier for employers to offer ESOPs by providing clear
regulations for ESOP valuation and fiduciary conduct that encourages the
participation of employee beneficiaries in corporate governance, while
recognizing the importance of financial diversification for retirement security.

Alternative View. Conservatives believe that it is important for American fami-
lies to have control over their savings and to be able to hold diversified assets. While
ESOPs can be a beneficial part of a worker’s and family’s savings, some conserva-
tives believe that the government should not favor one form of investment over
another or make it harder for families to have a diversified investment portfolio.

PUTTING AMERICAN WORKERS FIRST

A labor agenda focused on the strength of American families must put American
workers first. As the family necessarily puts the interests of its members first, so
too the United States must put the interests of American workers first.

Immigration. The H-2A visa, meant to allow temporary agricultural work-
ers into the United States, also suffers frequent employer abuse. The low cost of
H-2A workers undercuts American workers in agricultural employment. The H-2A
program is not subject to any statutory numerical cap and has been expanding in
recent years, surpassing 200,000 visa issuances for the first time in 2019.

e Cap and phase down the H-2A visa program. Congress should
immediately cap this program at its current levels and establish a
schedule for its gradual and predictable phasedown over the subsequent
10 to 20 years, producing the necessary incentives for the industry to
invest in raising productivity, including through capital investment in
agricultural equipment, and increasing employment for Americans in the
agricultural sector.

e Encourage the establishment of an industry consortium and match
funding. Congress should also encourage the establishment of an industry
consortium of agricultural equipment producers and other automation and
robotics firms interested in entering the sector and match funding invested
by the industry, with intellectual property developed within the consortium
freely available to all participants.

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Alternative View. Some conservatives believe that temporary worker programs
help to fill jobs that Americans will not fill, prevent illegal immigration by giving
farmers and others who hire low-skilled labor access to workers, and keep down
the prices of food and other products and services produced by the temporary
workers. Some credibly argue that, absent the H-2A program, many farmers would
have to drastically increase wages, raising the price of food for all Americans, and
that even such wage increases may not be sufficient to attract enough temporary
American workers to complete the necessary farm tasks to get food products to
market since those jobs are, by their nature, seasonal. Those who share this view
argue that any plan to phase out the program should weigh the program’s current
costs (relatively low) and the program’s current benefits (makes American farming
more profitable and sustainable while keeping down food costs).

e Phase out the H-2B visa program. The H-2B visa, for nonagricultural
seasonal workers, suffers from many of the same harms and abuses as H-2A,
albeit of lesser scope because of its cap and distribution across many sectors.
Congress should immediately cap this program at its current levels and
establish a schedule for its gradual and predictable phasedown over no more
than 10 years.

Alternative View. As with the H-2A program, some conservatives see the H-2B
program as a valuable program that provides low-cost temporary workers in jobs
that American companies, by and large, cannot find enough American workers to
fill (e.g., tourist season childcare providers at ski resorts, swimming instructors at
summer camps, housekeepers and groundskeepers at amusement parks, and extra
summer cooks at restaurants that serve national park patrons).These seasonal
jobs are less desirable to Americans who predominantly prefer year-round work.
Labor shortages after the pandemic support this belief. Absent the H-2B program,
many of these seasonal businesses would be forced to cut their hours or even close
altogether. Any plan to phase out the program should weigh the program’s current
costs (relatively low) and the program’s current benefits (makes seasonal business
more feasible).

Hire American Requirements. When government purchases goods or ser-
vices, if at all possible, not only should the company be an American company
and the products be manufactured in America, but the companies should also be
encouraged to hire American workers. Likewise, private employers shouldbe free
to prefer our own countrymen.

e Congress should mandate that all new federal contracts require at

least 70 percent of the contractor’s employees to be U.S. citizens, with
the percentage increasing to at least 95 percent over a 10-year period.

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e Congress must amend the law so that employers can again have the
freedom to make hiring Americans a priority. Despite the significant
advantages that preferring citizens over (work-authorized) aliens in hiring
would provide to American workers, businesses, and the country at large,
such a practice has been illegal since 1986.”° This makes no sense.

Alternative View Some conservatives believe that the government has a duty to
limit its spending in order to limit how much it takes from American families. This
means that when the government spends money, it must find the most econom-
ical and effective way to do so. Excessive government spending will be borne by
American workers and families through reduced incomes and purchasing power.
There may be good reasons to require a certain percentage of American workers on
federal contracts, but those decisions should be based on economy and efficiency
as opposed to arbitrary quotas.

Visa Fraud. American businesses that commit visa fraud and hire illegal immi-
grants should not be the beneficiaries of federal spending. But a 2020 report by
the Department of Labor’s Office of Inspector General (OIG) examined the depart-
ment’s process for excluding employers who commit visa fraud and abuse from
federal contracts and found much to be desired.

e To protect the American workforce from unscrupulous immigration
lawyers, employers, and labor brokers, the department must
follow the recommendations of the OIG and institute more robust
investigations for suspected visa fraud and speedier debarments for
those found guilty.

INTERNATIONAL LABOR POLICY

Leveling the International Playing Field for Workers. As recent decades
of intense import competition and offshoring have made clear, American workers
suffer when the U.S. opens its markets to foreign nations’ minimal labor standards
and exploitative conditions. While federal law already prohibits the importation of
goods produced with forced labor, the prohibitions are toothless without effective
means of enforcement and cover only the most basic of workers’ rights. The Trump
Administration and its United States Trade Representative (USTR) took unprece-
dented steps to redress the issue for workers. The U.S.-Mexico—Canada Agreement
(USMCA) contained the strongest and most far-reaching labor provisions of any
free trade agreement (FTA), with protections and commitments to reduce labor
abuses and raise wages. It also established new modes of enforcement.

For future FTAs, the USTR should replicate the labor provisions of USMCA,
especially the provisions to:

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Mandate for Leadership: The Conservative Promise

e Eliminate all forms of forced or compulsory labor.

e Protect workers’ rights to organize and participate voluntarily in a
union without employer interference or discrimination.

e Create a rapid-response mechanism to provide for an independent
panel investigation of denial of labor rights at covered facilities.

e Shift the burden of proof by presuming that an alleged violation
affects trade and investment, unless otherwise demonstrated.

For future authorizations of Trade Promotion Authority (TPA), the President
should urge Congress to:

e Create mechanisms for supply-chain transparency.
e Institute a general prohibition on forced labor conditions.

Investigate Foreign Labor Violations That Undermine American Work-
ers. The United States’ embrace of globalization has exposed American workers to
unfair competition from nations with cheap, abundant, and often exploited labor.
American workers have, as a consequence, seen their earning power erode. While
negotiating stronger trade agreements with robust labor provisions should be the
primary tool with which to regulate international labor competition, the federal
government can also take steps to identify the worst labor abuses and rule breakers.
DOL’s Bureau of International Labor Affairs (ILAB) plays a critical role in monitor-
ing and enforcing the labor provisions of U.S. trade agreements and trade preference
programs as well as investigating child labor and human trafficking violations.

e The next Administration should focus ILAB investigations on
foreign labor violations that do the most to damage American
workers’ earning power, specifically regimes that engage in child and
forced labor, fail to protect workers’ organizing rights, and permit
hazardous or otherwise exploitative working conditions.

Alternative/Additional View. Conservatives share a belief in protecting and pro-
moting American workers and their families and orienting international policies with
Americans’ interests first. Some conservatives believe that the best way to put Amer-
ica first is by making America more attractive. In addition to restrictions imposed
on other countries, removing existing barriers to American manufacturing, employ-
ment, and commerce can help American workers, entrepreneurs, and families.

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ORGANIZATIONAL AGENDA

Budget

Reduce the agencies’ budgets to the low end of the historical
average. The Trump Administration’s FY 2020 request, $10.9 billion,
would provide a workable target for spending reductions for DOL,
for example.

Spending reductions should occur primarily in the Employment and
Training Administration (ETA).

Focus health and safety inspections on egregious offenders, as other
inspections are often abused and usurp state and local government
prerogatives.

Personnel

Maximize hiring of political appointees. At its best, the Trump
Administration Department of Labor worked with up to 150 political
appointees. That is still a tiny percentage of the department. The number of
political appointees should be maximized in order to improve the political
accountability of the department.

Appoint new EEOC and NLBB general counsels on Day One. The Biden
Administration broke significant precedent by firing the EEOC and NLRB
general counsels despite their term appointments. The next Administration
should do the same and expand on the Biden Administration’s new
precedent by refusing to acknowledge terms in other offices, where
applicable, and installing acting or full new officers immediately.

Implement a hiring freeze for career officials. A hiring freeze imposes
financial discipline on agencies’ personnel costs and reduces agency bloat.

Office of Compliance Initiatives

DOL should fully staff the Office of Compliance Initiatives (OCD,
which was reopened by the Trump Administration after the Obama
Administration closed its predecessor down. OCI educates employers
and workers on their rights, responsibilities, and available recourse under
the many statutes, rules, and regulations administered by DOL. Most
businesses want to follow the law and OCI exists to make knowing the rules
easier, which leads to increased compliance.

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Mandate for Leadership: The Conservative Promise

Improve Visa-Related Labor-Market Monitoring

DOL’s Office of Foreign Labor Certification plays an important role in the
approval of H-visa applications, but it is currently housed in the Employment and
Training Administration, which is DOL’s primary grant-making division.

e OFLC should be moved out of ETA and made directly accountable to
the Secretary with a politically accountable Director.

CONCLUSION

The good of the American family is at the heart of conservative labor policy
recommendations. The longstanding tradition of a strong work ethic in American
culture must be encouraged and strengthened by policies that promote family-sus-
taining jobs. By eliminating the policies promoted by the DEI agenda, promoting
pro-life policies that support family life, expanding available apprenticeship
programs including by encouraging the role of religious organizations in appren-
ticeships, making family-sustaining jobs accessible, simplifying employment
requirements, and allowing employers to prefer American citizens when making
hiring decisions, among the other policy recommendations discussed above, we
can begin to secure a future in which the American worker, and by extension the
American family, can thrive and prosper.

AUTHOR’S NOTE: Many contributors, listed at the front of this volume, deserve credit for this work, but Oren
Cass, Rachel Greszler, Rachel Morrison, Caleb Orr, and Jonathan Wolfson deserve special mention. The author alone
assumes responsibility for the content of this chapter, and no views expressed herein should be attributed to any
other individual.

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ENDNOTES

1. — Gretchen Livingston and Anna Brown, “Intermarriage in the U.S. Fifty Years after Loving v. Virginia,” Pew
Research Center, May 18, 2017, https://www.pewresearch.org/social-trends/2017/05/18/intermarriage-in-the-
u-s-50-years-after-loving-v-virginia/ (accessed March 4, 2023).

2. President Lyndon B. Johnson, Executive Order 11246, “Equal Employment Opportunity,” httos://www.
presidency.ucsb.edu/documents/executive-order-11246-equal-employment-opportunity (accessed
March 7, 2023).

3. Pregnancy Discrimination Act of 1978, Public Law, 95-555. The Pregnancy Discrimination Act amended Title
VIL of the Civil Rights Act of 1964.

4. Consolidated Appropriations Act, 2023, Public Law No. 117-328, div. Il, 136 Stat. 4459 (2022).

5. Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq.

Dobbs v. Jackson Women’s Health Organization, No. 19-1392, June 24, 2022, https://www.supremecourt.gov/
opinions/21pdf/19-1392_6j37.pdf (accessed March 7, 2023).

Employee Retirement Income Security Act of 1974, 29 U.S.C. Ch. 18 $ 1001 et seq.

Religious Freedom Restoration Act of 1993, 42 U.S.C. Ch. 21B § 2000bb et seq.

Fair Labor Standards Act of 1938, 29 U.S.C. § 203.

10. Department of Labor, Promoting Regulatory Openness Through Good Guidance, Federal Register, Vol. 85, No.

68, August 28, 2020, https://www.govinfo.gov/content/pkg/FR-2020-08-28/pdf/2020-18500.pdf (accessed

arch 7, 2023).

11. Administrative Procedure Act, 5 U.S.C. Ch. 5, subchapter 1, § 500 et seq.

12. Regulatory Flexibility Act, 5 U.S.C. Ch. 6 § 601 et seq.

13. Donald J. Trump, Executive Order 13932, “Modernizing and Reforming the Assessment and Hiring of Federal

Job Candidates,” Federal Register, Vol. 85, No. 187 July 1, 2020) pp. 39457-39459, https://www.federalregister.

gov/documents/2020/07/01/2020-14337/modernizing-and-reforming-the-assessment-and-hiring-of-federal-

job-candidates (accessed March 7, 2023).

14. Workforce Investment and Opportunity Act, Public Law 113-128.

15. Coronavirus Aid, Relief, and Economic Security (CARES) Act, $.3548, 116th Congress, 2nd Sess.

16. Federal Unemployment Tax Act, ILR.C., Ch. 23.

17. American Rescue Plan Act of 2021, Public Law 117-2.

18. Teamwork for Employees and Managers (TEAM) Act of 2022, S. 3585, 117th Congress, 2nd Sess.

19. Worker’s Choice Act of 2019, H.R. 5147, loth Congress, Ist Sess.

20. F. Vincent Vernuccio, “Back to Business,” October 8, 2020, https://www.washingtonexaminer.com/opinion/
back-to-business (accessed March 4, 2023).

21. Fair Labor Standards Act of 1938, 29 U.S.C. § 203.

22. Occupational Safety and Health Act of 1970, 29 U.S.C. Ch. 15 § 651 et seq.

23. Davis-Bacon Act of 1931, Public Law 71-798.

24. Social Security Act of 1935, 42 U.S.C. Ch. 7.

25. The lmmigration Reform and Control Act of 1986, Public Law 99-603.

wo oN

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DEPARTMENT OF
TRANSPORTATION
Diana Furchtgott-Roth

INTRODUCTION

America needs transportation that is more abundant and affordable as well as
dignified, accessible, and family friendly. Transportation plays a vital role in the
prosperity and flourishing of the United States. Americans use trucks, tankers,
and trains to keep our supply chains running and cars, transit, and planes to go
where we want to go.

Two hundred and forty years ago, Adam Smith recognized that connections
were a bedrock of society because they stimulate specialization, innovation, and
capital investment. In the following decades, America’s growth was made possible
by transportation—first ports and transatlantic shipping, then roads, canals, and
eventually railroads pushing westward to create the nation we call home. Access
to transportation is part of what made our country great.

The U.S. Department of Transportation (DOT), with a requested fiscal year (FY)
2023 budget of $142 billion,’ was originally intended simply to provide a policy
framework for transportation safety, rulemaking, and regulation. However, it has
evolved to believe that its role is “to deliver the world’s leading transportation
system”*—that is, to select individual projects and allocate taxpayer funds in the
actual planning, developing, and building of transportation assets. Such a role is
held more appropriately by transportation asset owners: primarily states, munic-
ipalities, and the private sector.

In addition to providing a safety and regulatory framework through its 11 sub-
components, known as modes, the department has become a de facto grantmaking
and lending organization. DOT provides approximately $50 billion in discretionary

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Mandate for Leadership: The Conservative Promise

and formula grants, known as obligations, annually in areas ranging from transit
systems to road construction to universities and has lent or subsidized more than
$60 billion since the Transportation Infrastructure Finance and Innovation Act
(TIFIA) program,’ now managed by the Build America Bureau, was created in 1998.
This evolved role as a major, and often primary, funding and financing source is far
from the department’s original policy framework. It also removes incentives for
state and local officials to ensure that investments are worthwhile, because federal
money removes the need to get public buy-in to build and maintain infrastructure
projects as funding becomes “someone else’s money.”

Despite the department’s tremendous resources, congressional mandates and
funding priorities have made it difficult for DOT to focus on the pressing trans-
portation challenges that most directly affect average Americans, such as the high
cost of personal automobiles, especially in an era of high inflation; unpredictable
and expensive commercial shipping by rail, air, and sea; and infrastructure spend-
ing that does not match the types of transportation that most Americans prefer.
Transforming the department to address the varied needs of all Americans more
effectively remains a central challenge.

DOT is particularly difficult to manage because its 11 major components—nine
modal administrations, the Office of the Secretary, and the Office of the Inspector
General—all have their own sets of personnel including administrators, deputy
administrators, chiefs of staff, and general counsels. Most grants flow through the
modes, such as the Federal Highway Administration, Federal Transit Administra-
tion, and Federal Aviation Administration.

The Office of the Secretary contains its own grantmaking operation that funds
research and some special grants, as well as a major lending operation, the Build
America Bureau, that functions as an infrastructure bank. The Office of the Sec-
retary has department-wide offices for such functions as Budget and Financial
Management, the General Counsel, Policy, the Office of Research and Technology,
Government Affairs, Administration, the Office of the Chief Information Officer,
Small and Disadvantaged Business Utilization, Public Affairs, Drug and Alcohol
Policy and Compliance, and Civil Rights. The modal administrations include the:

Federal Aviation Administration (FAA);

e Federal Highway Administration (FHWA);

e Federal Railroad Administration (FRA);

e National Highway Traffic Safety Administration (NHTSA);

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2025 Presidential Transition Project

Great Lakes St. Lawrence Seaway Development Corporation (GLS);

Maritime Administration (MARAD);

Federal Motor Carrier Safety Administration (FMCSA); and

Pipeline Safety and Hazardous Material Administration (PHMSA).

DOT’s fundamental problem is that instead of being able to focus on providing
Americans with affordable and abundant transportation, it has become saddled
with congressional requirements that reduce the department to a de facto grant-
making organization. Yet there is little need for much of this grantmaking, for
two reasons:

e New technology enables private companies to charge for transportation in
many areas, which could transform how innovation is financed. It is vital to
consider the role of user fees and other pricing innovations with regard to
transportation infrastructure. Airport landing fees for aircraft, toll charges
on roads and bridges, and per-gallon taxes on gasoline and diesel fuel are
all examples of user charges that affect the decisions of transportation
system users. These changes could shift our nation’s transportation away
from being a top-down system that is misaligned with the needs of so
many Americans. Increasing private-sector financing could revolutionize
travel and increase everyday mobility to its greatest potential in a way that
Americans prefer. Doing so would keep transportation decisions out of the
hands of bureaucrats in Washington, D.C., who are far removed from local
problems and preferences.

e Iffunding must be federal, it would be more efficient for the U.S. Congress
to send transportation grants to each of the 50 states and allow each state
to purchase the transportation services that it thinks are best. Such an
approach would enable states to prioritize different types of transportation
according to the needs of their citizens. States that rely more on automotive
transportation, for example, could use their funding to meet those needs.

Meanwhile, many Americans continue to confront serious challenges with
their day-to-day transportation, including costs that have increased dramati-
cally in recent years. DOT in its current form is insufficiently equipped to address
those problems. DOT’s discretionary grant-making processes should be abol-
ished, and funding should be focused on formulaic distributions to the states,
which know best their transportation needs and are incentivized to think of the

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long-term maintenance costs. At a bare minimum, the number of grants should
be consolidated.

DOT would also reduce unnecessary burdens by returning to the Trump Admin-
istration’s “rule on rules” approach to regulations, implemented in late 2019 as RIN
2105-AE84.* This rule strengthened the Administration’s effort to remove outdated
regulations, find cost-saving reforms, and clarify that guidance documents are
in fact guidance rather than mandatory impositions. The Biden Administration
unwisely moved away from this reform, and the next Administration should revive

it without delay.

BUILD AMERICA BUREAU

The Build America Bureau (BAB) resides within the Office of the Secretary and
describes itself as “responsible for driving transportation infrastructure develop-
ment projects in the United States.”® This lofty-sounding goal in practice means
that the Bureau serves as the point of contact for distributing funds for transpor-
tation projects in the form of subsidized 30-year loans. For higher-quality projects
and in certain circumstances, these government loans may disintermediate the
private sector from providing similar financing, albeit at higher costs.

At certain times in the economic cycle, and for many lower-quality projects with
more dubious economic return, similar loans from the private sector are simply
not available. Should the BAB continue to exist and potentially disintermediate
the private financing sector, it must maintain underwriting discipline and continue
best practices of requiring rigorous financial modeling and cushion for repayment
of loans in a variety of economic scenarios. In addition:

e The BAB should ensure that these loans do not become grants in another
form by maintaining the requirement that all project borrowers be rated
at least investment grade by the major ratings agencies and that project
sponsors remain liable to ensure that all financing is repaid, even in periods
of financial stress and economic downturns.

e Project sponsors should be required to show that projects have positive
economic value to taxpayers, and sponsors should guarantee that all federal
financing will be repaid through properly structured loan terms, including a
minimum equity commitment from all project sponsors.

e All projects should also be required to show repayment ability in various
interest rate environments, and the BAB should ensure that long-term loans
are structured appropriately with regard to the fixing of interest rates and
hedging of interest rate risk on the part of the borrowers to avoid financial
stress or default driven solely by rising interest rates.

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2025 Presidential Transition Project

e Policymakers should maintain awareness and promote transparency
regarding the continued existence of this loan program and whether private
financiers are being disintermediated by the subsidized BAB lending that
the private sector simply cannot match.

e Acost-benefit analysis of the federal government’s potential replacement
and disintermediation of the private financing sector regarding
infrastructure loans, which is not currently performed, should be conducted
on a regular basis.

PUBLIC-PRIVATE PARTNERSHIPS

Much infrastructure could be funded through public-private partnerships (P3s),
a procurement method that uses private financing to construct infrastructure. In
exchange for providing the financing, the private partner typically retains the right
to operate the asset under requirements specified by the government in a contract
called a concession agreement. In addition, the private partner is given the right
either to collect fees from the users of the asset or to receive a periodic payment
from the government conditioned on the asset’s availability: If a highway is not
open to traffic when it should be, for example, the government’s payment to the
private concessionaire is reduced.

The best practice for a government that is interested in using a P3 to deliver
a project is for the government first to perform a value-for-money study, which
compares the costs and benefits of procuring the asset under a typical procurement
against the costs and benefits of utilizing a P3. Since private equity is involved, the
financing costs for P3s are higher, but they also are frequently more than offset by
the private sector’s ability to generate efficiencies and cost savings in the design,
construction, maintenance, and operation of the asset. If the value-for-money
study finds that the efficiencies of a P3 and the value of risk shifted to the private
sector exceed the additional financing costs, then utilizing a P3 is good public policy
because Americans have better infrastructure at a lower cost.

As well as providing better transportation facilities for Americans, P3s offer a
number of benefits to governments. Specifically, they:

e Provide access to some of the world’s best talent with vast experience in
delivering infrastructure,

e Create incentives for innovation and creativity,

e Shift unique project risks to companies that are familiar with
those risks, and

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e Allow designers, contractors, and maintenance teams to work together
through the delivery of the process to focus on lifecycle costs as opposed to
just initial design and construction costs.

It should be noted that project funding and P3s are not synonymous. Policy-
makers and government leaders frequently mistake the financing that P3s provide
for funding. A P3 allows the government to obtain equity from the private sector,
but that equity has to be paid back with interest. Like a loan, a P3 can be used to
accelerate revenues and provide needed capital to help pay the upfront costs of a
project, but also like a loan, the private P3 investors must be paid back for investors
to realize a financial return.

Some mistakenly think that using a P3 would allow a road or bridge to be deliv-
ered without increases in tolls or taxes. It is important to remember that all funding
for governmental infrastructure comes from either taxes or user fees. P3 financing
can be used to make those funding sources more efficient, but it cannot replace the
need for taxes or user fees to provide the funding for the project.

In addition, a poorly managed P3 procurement process (the process govern-
ment uses to identify the best private P3 partner) can result in excessive consultant
costs and years-long delays in delivery. While P3s can offer efficiencies in delivering
the project, the P3 procurement process itself can be significantly longer and more
expensive than traditional procurement processes.

Finally, and possibly most important, a P3 gives a private party the ability to
collect fees or payments over decades (a period well beyond the length of the
careers of the political appointees who sign contracts with private parties). Thus,
P3s create an opportunity for current governmental leaders to obtain a higher
upfront payment from the private party in exchange for greater user fees paid by
future generations who will use the asset. In other words, a governmental CEO
(governor, mayor, head of an authority) can use a P3 to impose unnecessarily high
costs on users decades in the future in exchange for upfront cash. It is important
that contracts be transparent in order to minimize this possibility.

A P3’s greatest public value is realized when the procurement model is used for
a project that is unusually risky or a type of project with which the government
has limited experience such as a tunnel or light rail line. P3s are an excellent tool
for transferring risk from the public sector to the private sector and can create
considerable value for the taxpaying public. However, a high degree of expertise
is required to ensure that the risk transfer warrants the higher financing and pro-
curement costs that P3s impose.

EMERGING TECHNOLOGIES

As private companies develop a future of new, emerging technologies, one role
for DOT is driving clarity in the government’s role and setting standards for safety,

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security, and privacy without hampering innovation. DOT can oversee the testing
and deployment of a wide variety of new technologies, allowing communities and
individuals to choose what best fits their needs. It is the role of the private sector,
not the government, to pick winners and losers in technology development. If a
technology underperforms, the private sector should be liable, not the government.

The department should ensure a tech-neutral approach to addressing any
emerging transportation technology while keeping safety as the number one
priority. As part of this, it should work to facilitate the safe and full integration
of automated vehicles into the national transportation system. Over time, these
advanced technologies can save lives, transform personal mobility, and provide
additional transportation opportunities—including for people with disabili-
ties, aging populations, and communities where car ownership is expensive or
impractical.

NHTSA’s and FMCSA’s current regulations were written before the advent of
automated vehicles and driving systems. Both operating administrations have
issued Advance Notices of Proposed Rulemakings (ANPRMs) that begin the pro-
cess of updating their regulations to reflect this new technology. However, these
regulations have stalled under the Biden Administration, which has chosen to
use the department’s tools to get people to take transit and drive electric vehicles
instead of helping people to choose the transportation options that suit them best.

e NHTSA should work to remove regulatory barriers by focusing on updating
vehicle standards as well as publishing performance-based rules for the
operations of automated vehicles (AVs).

e FMCSA should work to clarify the regulations to align with DOT’s AV 3.0
guidance, which would allow the drivers to be safely removed from the
operations of a commercial motor vehicle.

From a nonregulatory point of view, DOT has pivoted from a successful focus
on the voluntary sharing of data to improve safety outcomes to adoption of a more
compulsory and antagonistic approach to mandating data collection and publica-
tion through a Standing General Order related to automated vehicles. This needs
to be reversed.

Many of these new and innovative technologies rely on wireless communica-
tions that depend on the availability and purchase of radio frequency spectrum,
a trend that is consistent with what we see in connectivity in our everyday lives.
There is arole for DOT in ensuring that in the fight over spectrum, transportation
gets its fair share.

For technologies to work in transportation, and in particular to work for
transportation safety, they have to meet the unique needs of a transportation

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Mandate for Leadership: The Conservative Promise

environment. They need to account for rapidly moving and out-of-line-of-sight
vehicles as well as pedestrians, bicyclists, and other road users. They should
account for the potential for radio interference, and they should address security.

This is why in 1999, in response to a request from Congress, the Federal Com-
munications Commission allocated the 5.9 GHz band of spectrum to traffic safety
and intelligent transportation systems (ITS). In 2020, the FCC took away 45 MHz
of the 75 MHz it had added, leaving only 30 MHz for transportation safety and
ITS. DOT needs to represent the transportation community and make the case
for needed spectrum to the public and Congress.

CORPORATE AVERAGE FUEL ECONOMY (CAFE) STANDARDS

One reason for the high numbers of injuries on American roadways is that
national fuel economy standards raise the price of cars, disincentivizing people
from purchasing newer, safer vehicles.

Congress requires the Secretary of Transportation to set national fuel econ-
omy standards for new motor vehicles sold in the United States. This mandate
was established in the Energy Policy and Conservation Act of 1975 (EPCA),° a law
passed in the wake of the Arab oil embargo to promote greater energy efficiency
and lessen the national security threat of U.S. dependence on foreign oil. The stat-
ute directs DOT to prescribe the “maximum feasible” mileage requirements for
different categories of internal-combustion engine (ICE) automobiles for each
model year. The standards must be achievable using available ICE technologies
running on gasoline, diesel fuel, or similar combustible fuels and must not be set so
high as to prevent automakers from profitably producing new vehicles at sufficient
volume to meet consumer demand.

Congress recognized that the ICE-powered automobile has been instrumen-
tal to advancing the mobility and prosperity of the American people and that the
domestic mass production of new ICE vehicles generates millions of jobs and
remains critical to the overall health of the U.S. economy and the strength of the
nation’s industrial base. Accordingly, Congress took care to ensure that the mileage
requirements issued by DOT would not undermine the vitality of America’s auto
industry or interfere with the market economics that drives consumer demand
for new vehicles.

This rulemaking authority, which has been delegated by the Secretary to
the National Highway Traffic Safety Administration, is exclusive to DOT. EPCA
expressly preempts states from adopting or enforcing any different requirement

“related to fuel economy standards” for new motor vehicles. While the statute
instructs DOT to consult with the Department of Energy and the Environmental
Protection Agency (EPA) in formulating its standards, no other federal agency,
including EPA, has clear authority to set fuel economy requirements in place of
NHTSA. The Clean Air Act’ gives EPA general authority to establish emissions

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limits for new motor vehicles for air pollutants that are found to pose a danger to
humans. However, there is no reason to believe Congress ever contemplated that
EPA’s authority to address automotive air pollution might be used to displace or
supersede NHTSA’s fuel economy mandate under EPCA.

Congress chose to assign the power to set fuel economy standards to DOT
rather than EPA. This was not only because DOT understands the technologies
and economics of the auto industry, but also because NHTSA is the nation’s leading
motor vehicle safety regulator, and Congress sought to ensure that fuel economy
requirements would not adversely affect highway safety. Unfortunately, the Biden
Administration has flouted these statutory limitations in nearly every respect. The
predictable result is higher expected transportation costs for Americans.

e Inpursuit of an anti-fossil fuel climate agenda never approved by Congress,
the Biden Administration has raised fuel economy requirements to levels that
cannot realistically be met by most categories of ICE vehicles. The purpose
is to force the auto industry to transition away from traditional technologies
to the production of electric vehicles (EVs) and compel Americans to
accept costly EVs despite a clear and persistent consumer preference for
ICE-powered vehicles. In further support of this agenda, federal regulators
administer a scheme of generous fuel economy credits that subsidize EV
producers such as Tesla at the expense of legacy automakers.

e Moreover, and contrary to Congress’s design, the Biden EPA has been
given preeminence in the regulation of fuel economy through the setting
of carbon dioxide emissions limits for new motor vehicles under the Clean
Air Act. Because carbon dioxide emissions levels correspond to mileage
in automobiles powered by fossil fuels, these EPA rules are de facto fuel
economy requirements that apply independently of NHTSA’s standards.

e The Biden Administration has also granted California a special waiver under
the Clean Air Act that permits the California Air Resources Board (CARB) to
issue its own fuel economy directives, notwithstanding EPCA’s prohibition
on state standards. Under this waiver, CARB has ordered automakers to
phase out the sale of ICE-powered automobiles in California and transition
to the production of zero-emission vehicles by 2035. The Clean Air Act
allows other states to follow California’s requirements; thus, CARB is
effectively determining fuel economy policies for the entire nation.

As a result of these regulatory actions, automobiles will be significantly more

expensive to produce, there will be fewer affordable new vehicle options for Amer-
ican families, and fewer new vehicles will be sold in the U.S. That will do more than

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translate into a loss of auto industry jobs for American workers: It will also mean a
significant increase in traffic deaths and injuries. As fewer new cars are purchased,
the price of used cars will rise, and more Americans will be left driving older cars,
which traffic statistics show are much less safe than newer vehicles. NHTSA itself
has acknowledged that the Biden Administration’s fuel economy standards will
generate hundreds of additional fatalities and thousands of additional injuries
on U.S. highways. Because older cars also produce more harmful air pollution, the
aging of America’s fleet will also have negative consequences for air quality.

In addition, the Biden Administration’s efforts to accelerate EV sales by reg-
ulatory fiat work against the national security interests of the United States in
contravention of Congress’s goals under EPCA. Increasing the production of EVs
will make the U.S. more dependent on China and other foreign countries that
control the supply and processing of rare earth minerals that are needed for EV
batteries. And the faster deployment of EVs will put a major strain on America’s
vulnerable power grid, requiring large investments in critical infrastructure and
a big boost in the nation’s electricity production, including from gas-fired and oil-
fired power plants.

In exchange for all of these harmful effects—on traffic safety, consumer choice,
American jobs, the nation’s air quality, and U.S. national security—the Biden fuel
economy regulations are predicted to have no meaningful effect on global tem-
perature trends over the long term.®

The next Administration must return the federal fuel economy program to the
limits established by Congress. The standards issued by NHTSA must be reset at
reasonable levels that are technologically feasible for ICE automobiles and con-
sistent with an increase in domestic auto production and healthy growth in the
sale of safer and more affordable new vehicles. To achieve these goals, the next
Administration should:

e Reduce proposed fuel economy levels. The Administration should
consider returning to the minimum average fuel economy levels specified
by Congress for model year 2020 vehicles: levels aimed at achieving a
fleet-wide average of 35 miles per gallon. Consideration should be given
to maintaining the standards at those levels for the near term in order to
promote the objectives laid out by Congress.

e Ensure that DOT again exercises priority in the setting of fuel
economy standards. Any EPA limits on carbon dioxide emissions, even
if authorized under the Clean Air Act, must support and work in harmony
with DOT standards and must not override them or usurp DOT’s regulatory
role under EPCA. For example, EPA could regulate air conditioning systems
and leave engine standards to DOT.

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2025 Presidential Transition Project

e Revoke the special waiver granted to California by the Biden
Administration. California has no valid basis under the Clean Air Act to
claim an extraordinary or unique air quality impact from carbon dioxide
emissions, and EPCA is clear that under no circumstances may a state
agency regulate fuel economy in place of DOT. The federal government
should therefore exercise its preemptive authority over CARB and take all
steps necessary to invalidate any inconsistent fuel economy requirements
imposed by CARB, including its ban on sales of internal combustion engines.

FEDERAL HIGHWAY ADMINISTRATION

The Federal Highway Administration (FHWA) has jurisdiction over the inter-
state highway system, which is vital for the transportation of goods and people
throughout the country. The FHWA, in conjunction with state DOTs, works to
ensure the quality and safety of highways and bridges.

However, over the course of decades, presidential Administrations and Con-
gress have caused the FHWA to go beyond its original mission. The variety of
infrastructure projects now eligible for funding through the FHWA include fer-
ryboat terminals, hiking trails, bicycle lanes, and local sidewalks. In many cases,
such projects should be the sole responsibility of local or state governments, not
dependent on FHWA funding. For local projects, federal involvement adds red
tape and bureaucratic delays rather than value.

The Biden Administration has broadened the FHWA’s scope by emphasizing the
priorities of progressive activists instead of pursuing practical goals. These policies
include a focus on “equity,” a nebulous concept that in practice means awarding
grants to favored identity groups, as well as imposing obligations on states concern-
ing carbon dioxide emissions from highway traffic—areas not encompassed within
FHW4A’s statutory authorities. Furthermore, the Biden Administration’s embrace
of the “Vision Zero” approach to safety often means actively seeking congestion
for automobiles to reduce speeds. Finally, the Administration has sought to use
a “guidance memo” to impose policies not enacted by Congress, most notably to
make it harder for growing states to expand highway capacity. Instead, the next
Administration should:

e Seek to refocus the FHWA on maintaining and improving the
highway system.

e Remove or reform rules and regulations that hamper state
governments.

e Reduce the amount of federal involvement in local
infrastructure decisions.

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Mandate for Leadership: The Conservative Promise

AVIATION

Americans value the ability to travel safely and inexpensively by air. In the
United States, the private sector has developed the world’s safest, most effective
passenger and cargo air transport networks. Current policies threaten to undo that
legacy and to strangle the development of new technologies such as drones and

“advanced air mobility,” including small aircraft to serve as air taxis or to conduct
quiet vertical flights.

Starting in the 1970s, deregulation and increased competition turned air travel
from a luxury to an affordable travel option enjoyed by most Americans. The United
States has four major airlines, each with roughly 20 percent of the domestic market.
They compete with each other over the vast majority of routes. Several smaller
carriers provide additional competition and other options for travelers.

The current Administration’s policies are self-contradictory. In order to pla-
cate specific labor groups, the Biden Administration not only opposes the growth
of the major airlines, which would reduce the price of air travel, but also opposes
measures—such as low-fare foreign competition and joint ventures of smaller U.S.
carriers—that would increase competition.

Another problematic area is aviation consumer protection. Congress has autho-
rized DOT to prohibit specific “unfair and deceptive practices” in the airline industry
after undertaking a hearing process—authority exercised by the Office of Aviation
Consumer Protection within the General Counsel’s Office. Beginning with the Obama
Administration, this authority has been used to justify broad new regulations—in the
name of achieving “fair” competition—that would impose burdensome disclosure
mandates and other costly requirements without a sufficient process for gathering
supporting evidence. The Trump Administration reformed the process for issuing
such “unfair and deceptive practices” rules,’ but the Biden Administration promptly
reversed those reforms.’° A new Administration should restore them.

In general, the next Administration should focus its efforts on making air
travel more affordable and abundant, increasing safety, increasing competition
to benefit the flying public, and removing obstacles to the rapid deployment of
emerging aviation technologies that hold the promise of improved safety, compe-
tition, opportunity, and growth. To achieve a more level playing field and increase
options for the traveling public, the next Administration should:

e Publicly indicate that a new Administration would support joint-
venture efforts by smaller carriers (for example, Jet Blue and
Spirit) to achieve scale necessary to reduce costs and compete more
effectively with the larger carriers.

e Review foreign ownership and control limitations and, if necessary,
work with Congress to change existing statutes. Worldwide investors

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2025 Presidential Transition Project

are providing access to capital to foreign airlines for innovations and new
equipment purchases that U.S. airlines cannot match. The U.S. should
use the Committee on Foreign Investment in the United States (CFIUS)
process to keep out nefarious foreign actors while allowing investment
from investors in designated like-minded countries so long as U.S.-based
investors maintain plurality ownership.

e Establish a New Entry Initiative that commits the federal
government to approving or rejecting the applications of new air
carriers within 12 months.

e Initiate a rulemaking to allocate slot-pairs more consistently to
airlines at capacity-controlled airports on the primary basis of safety,
maximizing capacity, and competition.

Ina perfect world, the market would dictate these options, but in the highly
regulated international aviation sector, the current incentives are to keep out com-
petitors. Slot regulations have not been updated since the 1990s.

Well-meaning legislation and the pilot shortage are adversely affecting aviation
safety. In the wake of the 2009 Colgan Airlines crash, all commercial pilots and
copilots were required to have 1,500 flight hours. Today, facing a pilot shortage,
larger and safer twin-engine planes with two pilots are being phased out of service
at smaller airports and replaced by single-engine planes that have only one pilot.
This trend could be reversed if copilots were required to have fewer flight hours
or could count certified simulator training.

Federal subsidies are also distorting the commercial market. The Essential
Air Service (EAS) program subsidizes flights to 200 small airports that are not
otherwise commercially viable. The program was established in the 1970s asa
temporary measure to cushion deregulation. It has since been made permanent.
Finally ending the program would free hundreds of pilots to serve larger markets
with more passengers. Anew Administration could reform regulations to encour-
age airports in lower-served areas of the nation.

International air travel is regulated and restricted by individual treaties between
the United States and other countries. The new Administration should remain
committed to the laudatory goal of “Open Skies.” However, many of the largest
emerging markets are not fully open, and our aviation policies should reflect that
reality and ensure that U.S. air carriers compete on a level playing field. Specifically,
so long as U.S. carriers are not able to fly over Russian airspace, the U.S. should not
allow foreign carriers serving markets in East Asia and South Asia to enjoy a com-
petitive advantage by continuing to allow them to fly to the U.S. China has failed to
put in place several of the policies to which it has already agreed; the U.S. should

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not offer additional negotiations until the Chinese implement the agreements
they have already signed.

The current Administration’s policies in several areas that affect aviation and
limit America’s future opportunities for growth are internally inconsistent. In
addition to a New Entry Initiative, the new Administration should establish an
interagency clearinghouse to drive consistent policies across the government on
spectrum, drones, and advanced air mobility.

FEDERAL AVIATION ADMINISTRATION

With a budget of $18.6 billion requested for FY 2023" and an international
regulatory footprint, the Federal Aviation Administration (FAA) is DOT’s most
visible mode. It needs reform. Air traffic control (ATC) operations account for
two-thirds of FAA’s budget, and the Air Traffic Organization (ATO) is far behind
its counterparts in Australia, Canada, and Western Europe in implementing
21st century technology. The FAA’s primary mission is ATC; its two smaller
functions are distributing federal airport grants and regulating all aspects of
aviation safety.

The FAA was once considered the world’s best government aviation agency.
Those days are long past. In the more than five decades since 1958 when the Federal
Aviation Agency (precursor to the Federal Aviation Administration) was formed,
there have been notable developments in air traffic control technology, aircraft
avionics, and engine reliability, but despite many well-intentioned attempts, there
have been few changes in the FAA’s funding structure. The FAA is still improperly
organized and financed, and the management reforms provided in the late 1990s
remain largely unused.

The FAA is 10 years older than DOT. It provides two separate and functionally
different services: the world’s largest and most complex Air Navigation Service
Provider (ANSP) and, at the same time, the world’s largest civil aviation regulatory
and certificatory agency. The first is a 24/7/365 air traffic service provider. The
second is an inherently governmental organization responsible for ensuring that
aerospace operators, vehicles, airports, and ANSPs are properly certified and follow
all FAA regulations. These two different organizations ought to run separately.

The FAA is the only modern Civil Aviation Authority (CAA) in the world that
does not assess fees for its services. Its funding structure, subject to the annual
appropriations process, stifles efficiency and innovation—and the FAA does not
innovate well. It spends too much time and money on research and development
(R&D) and is not very good at either one. It should get out of the R&D business and
focus on testing, evaluating, and certifying private-sector innovation much more
quickly than it does today.

The FAA workforce needs to modernize. The agency needs safety and certifi-
cation experts, not professional airframe and powerplant mechanics (A&Ps). It

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2025 Presidential Transition Project

needs to hire people trained to oversee mechanics, engineers, and pilots. It is time
to consider promoting the FAA’s top executive team from within and requiring
strict professional requirements for its top appointees. Organizations such as the
FAA whose sole responsibility is public safety should be fully auditable and led by
experts in their field or industry with oversight from DOT leadership.

For 60 years, the FAA was the global leader in aerospace, from general aviation
to commercial space, but the U.S. lead has vanished. The FAA’s overly bureaucratic,
legalistic, byzantine, and more recently hyperpoliticized way of processing regu-
lations, adopting innovation, publishing rules, and procuring new technologies
has been eclipsed by foreign CAAs and ANSPs that are eagerly certifying drones
and creating environments in which new technologies and new entrants, such as
air taxis, can thrive. To regain America’s global leadership in aviation, the next
Administration should:

e Separate the FAA from DOT or, at a minimum, separate the ATO
from the FAA.

e Completely restructure the FAA’s funding system so that the nation’s
aviation system is not held prisoner to annual appropriations or used
as a political football to solve nonaviation problems.

e Require the FAA to operate more like a business. The FAA has not made
good use of the unique authority it has been given in areas like personnel
and acquisition.

In Europe, conventional control towers are being replaced by digital/remote
towers with high-resolution cameras and other sensors on tall structures and at
points adjoining runways. In Germany and Scandinavia, as many as 15 small air-
ports can be controlled from one remote tower center. The FAA has yet to certify
a single digital/remote tower.

Text messaging between controllers and pilots is widespread over the oceans.
The ATO began to implement what is now called DataComm in 2002 but sus-
pended the project in 2003. This was restarted at airport control towers in 2016,
but as of October 2022, it was available in only seven of the 20 high-altitude
control centers.

Current technology enables flights to be managed “anywhere from anywhere,”
but the ATO resists consolidating its 20 aging centers into a much smaller
number—and lacks the funds to consolidate them. The FAA as regulator and
the ATO as traffic manager have no plans in place to handle millions of drones
and other emerging technologies such as electric vertical take-off and landing
(eVTOL) aircraft.

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Mandate for Leadership: The Conservative Promise

These shortcomings have been documented over many decades by the Govern-
ment Accountability Office and DOT Inspector General. One peer-reviewed study
for the Hudson Institute by scholar Robert Poole identified the ATO’s underlying
problems as including an overly cautious culture, a growing lack of technological
and managerial expertise, the inability to finance major capital projects with rev-
enue bonds, and overdependence on aerospace/defense contractors.”

All of these problems are interrelated. Because of the ATO’s lack of top-notch
engineers and program managers, it has become dependent on aerospace contrac-
tors, unlike counterparts in Canada and the United Kingdom. Operating within the
constraints imposed by the annual congressional appropriations process—and with
no bonding authority—the ATO is forced to implement major projects piecemeal
over many years. The ATO’s overly cautious culture appears to stem from its being
embedded in a safety regulatory agency rather than being regulated at arm’s length
(as are airlines and airports).

Three organizational changes, all requiring legislation, offer the likelihood of
dealing with these problems based on the experiences of air traffic providers in
Canada and Europe. They could be implemented one at a time or together.

e Separate the ATO from the FAA and relocate it to separate
headquarters outside the District of Columbia.

e Shift from aviation user taxes to fees for air traffic services paid
directly to the ATO.

e Allow the ATO to issue long-term revenue bonds for major projects.

Shorter-term reforms could include implementing user fees for unconventional
airspace users (for example, advanced air mobility, space launch, and recovery)
and giving the ATO a deadline after which it could not authorize or fund any more
nondigital/remote control towers. These reforms would also require legislation.

FEDERAL TRANSIT POLICY

The definition of “mobility” continues to evolve dramatically with the rise of
new multimodal concepts, traveler needs, and emerging capabilities. These fun-
damental changes in the way transportation services are offered also influence the
form of our communities.

New micromobility solutions, ridesharing, and a possible future that includes
autonomous vehicles mean that mobility options—particularly in urban areas—
can alter the nature of public transit, making it more affordable and flexible for
Americans. Unfortunately, DOT now defines public transit only as transit pro-
vided by municipal governments. This means that when individuals change their

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2025 Presidential Transition Project

commutes from urban buses to rideshare or electric scooter, the use of public
transit decreases. A better definition for public transit (which also would require
congressional legislation) would be transit provided for the public rather than
transit provided by a public municipality.

The COVID-19 pandemic caused a substantial decline in usage for all forms of
transportation. Mass transit has been the slowest mode to recover, with October
2022 ridership reaching only 64 percent of the level seen in October 2019, The
sustained increase in remote work has caused changes in commuting patterns.
Since facilitating travel for workers is one of the core functions of mass transit
systems, a permanent reduction in commuting raises questions about the viability
of fixed-route mass transit, especially considering that transit systems required
substantial subsidization before the pandemic.

Regrettably, the 2021 Infrastructure Investment and Jobs Act authorized tens
of billions of dollars for the expansion of transit systems even as Americans were
moving away from them and into personal vehicles. Lower revenue from reduced
ridership is already driving transit agencies to a budgetary breaking point, and
added operational costs from system expansions will make this problem worse.

The Capital Investment Grants (CIG) program is another example of Washing-
ton’s tendency to fund transit expansion rather than maintaining or improving
current facilities. The CIG program, which began in 1991, funds only novel transit
projects. These can include new rail lines (regardless of the demand for preexisting
rail in the area) and costly operations such as streetcars.

Because Americans have demonstrated a strong preference for alternative
means of transportation, rather than throwing good money after bad by continuing
federal subsidies for transit expansion, there should be a focus on reducing costs
that make transit uneconomical. The Trump Administration urged Congress to
eliminate the CIG program, but the program has strong support on Capitol Hill.
At aminimum, a new conservative Administration should ensure that each CIG
project meets sound economic standards and a rigorous cost-benefit analysis.

The largest expense in transit operational budgets is labor. Compensation costs
for transit workers exceed both regional and sector compensation averages. This
is driven by generous pension and health benefits rather than by exorbitant wages.
Since workers value wages more than they value fringe benefits, this has led toa
perverse situation in which transit agencies have high compensation costs yet are
struggling to attract workers.

The next Administration can remove the largest obstacle to reforming labor
costs. Section 10(c) of the Urban Mass Transportation Act of 1964" was initially
intended to protect bargaining rights for workers in privately owned transit sys-
tems that were being absorbed by government-operated agencies. The provision
has mutated into a requirement that any transit agency receiving federal funds
cannot reduce compensation, an interpretation that far exceeds the original statute.

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Mandate for Leadership: The Conservative Promise

Returning to the original intent would allow transit agencies to adjust fringe ben-
efits without fearing a federal lawsuit.

It is also vital to move away from using the Highway Trust Fund to prop up
mass transit. The fund was driven into insolvency (and repeated bailouts) through
decades of transfers to transit without any increase in transit usage to show for it.
With the federal government facing mounting debt, the best course of action would
be to remove federal subsidies for transit spending, allowing states and localities
to decide whether mass transit is a good investment for them.

FEDERAL RAILROAD POLICY

The Federal Railroad Administration (FRA) is making decisions based on
political considerations that are at variance with its safety mission. Instead of
basing regulatory decisions on the costs and benefits of the available alterna-
tives, FRA is promoting actions that favor the status quo and inhibit the use of
technology to improve railroad safety. FRA should be making decisions based
on objective evidence of the most cost-effective way to accomplish the agency’s
safety goals.

FRA’s singular focus on job preservation is contrary to FRA’s mission, and it
has a deleterious effect on the morale of FRA’s professional staff, as shown by
the annual employee surveys conducted by the Office of Personnel Management.
FRA needs to communicate clearly to its career employees anew commitment to
making decisions that are consistent with the agency’s safety mission.

FRA’s procedures call for decisions on waivers to be made by its Safety Board.
Appeals can be taken to the Administrator. However, FRA has deviated from these
procedures as the Administrator has injected himself into Safety Board decisions.
FRA needs to review its actions with respect to specific proceedings where the
agency’s direction cannot be justified. For example:

e FRA’s Notice of Proposed Rulemaking (NPRM) on crew size is not
based on safety considerations; it is designed to reduce flexibility by
making it impossible for railroads to operate with crews of fewer than
two in circumstances where there is no operational need for the second
crew member.

e Although FRA could adopt a modern inspection program that takes
advantage of technological ways to inspect track, it is refusing to amend
50-year-old track inspection requirements, leaving customers with
higher costs.

e FRAis refusing to take final action on a rulemaking proceeding that would
modernize brake inspection requirements by taking advantage of the ability

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2025 Presidential Transition Project

to track brake inspections on rolling stock electronically instead of by using
paper air brake slips, which would enable extending the interval between
brake inspections for trains and eliminating restrictions on the ability to
place/remove blocks of cars in trains.

e FRAwillbe proposing certification requirements for dispatchers and signal
employees despite the failure of the Railroad Safety Advisory Committee
(RSAC) to identify any safety benefit.

e FRAis planning to propose emergency escape breathing apparatus
requirements for train crews even though FRA staff long ago concluded
that the costs of these requirements would far outweigh their very
minimal benefits.

It is vital that the integrity of FRA’s research program be preserved. In 2022,
FRA switched the management of the Transportation Technology Center (TTC)
in Pueblo, Colorado, from a subsidiary of the Association of American Railroads
(AAR) to Ensco, Inc. FRA seems determined to direct research to TTC, even when
there are better choices with respect to the research in question, in an effort to
support TTC financially and justify its decision to change management at TTC.
This change in approach threatens the collaborative approach to research between
FRA and the railroads that has existed for decades. FRA should make its decisions
on where to spend its research dollars solely on the merits of improving the safety
and efficiency of the railroad industry.

MARITIME POLICY

The Maritime Administration (MARAD) was established by President Harry
Truman in 1950 and was transferred to DOT in 1981. A principal function is “main-
tain[ing] the overall health of the U.S. Merchant Marine,” which is important
both to national defense and to foreign and domestic commerce. MARAD is also
in charge of the United States Merchant Marine Academy and operates ships and
funding for the six state maritime academies.

MARAD would be better served by being transferred from DOT to the Depart-
ment of Homeland Security (DHS). MARAD is the only DOT modal administration
that does not regulate the industry that it represents: The maritime industry is
regulated by the U.S. Coast Guard (ships and personnel) and by the Federal Mari-
time Commission (cargo rates and competitive practices).

Furthermore, MARAD has responsibilities both in peacetime commerce and
operationally in wartime/crisis sealift through its responsibility to manage the
National Defense Reserve Fleet and 45-ship Ready Reserve Force for the U.S. Navy.
These missions are unique to MARAD within DOT. Asa result, MARAD’s missions

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Mandate for Leadership: The Conservative Promise

and purpose, and therefore its funding priorities, are not well understood and his-
torically have been minimalized in planning and budgeting.

MARAD, including its subordinate Service Academy (the U.S. Merchant Marine
Academy) should be transferred to the Department of Defense (if the Coast Guard
is located there because DHS has been eliminated) or to the Department of Home-
land Security. In this way, the two agencies charged with oversight and regulation
of the Maritime sector—MARAD and the United States Coast Guard—would be
aligned under the same department where operational efficiencies could be real-
ized more easily.

Serious consideration should be given to repealing or substantially reforming
the Jones Act,’ which would require legislation. The economic costs of the Jones
Act, which is notionally in place to promote a robust Merchant Marine, vastly
exceed its effect on the supply of domestic ships. For instance, no liquified natural
gas (LNG) can be shipped from Alaska to the lower 48 states because there are no
U.S.-flagged ships that carry LNG. If there are genuine concerns about U.S. fleet
capacity in the absence of the Jones Act, it would be possible to do so through an
expansion of the Defense Reserve Fleet.

Another DHS agency, the Federal Emergency Management Agency (FEMA), isa
frequent user of MARAD Ready Reserve Force shipping during disaster assistance
missions. Transferring MARAD to DHS would make coordination and requisition
of those vessels a smoother and more rapid process. DHS has responsibility for
reviewing and approving Jones Act waivers. This process first requires a market
survey of available shipping tonnage that is completed by MARAD. The processing
of Jones Act waiver requests would be streamlined if both agencies were in the
same department.

Finally, DHS as a department is experienced in administering and budgeting for
the operation of an existing federal service academy, the U.S. Coast Guard Academy,
which is similar to the U.S. Merchant Marine Academy in size. There would be
increased efficiencies and better alignment of the missions of these two institutions
if they were under one single department that has equity in the industries served
by these academies.

CONCLUSION

Americans need more abundant and affordable transportation. They need more
affordable and safer cars as well as physical aspects of transportation such as roads,
bridges, airports, ports, and rail lines. The Department of Transportation should
be evaluating which aspects of transportation are contributing to the economic
competitiveness of the United States and the well-being of Americans—and that
therefore should continue to be funded.

All too often, DOT’s mission is described as reducing the number of trips, using
less fuel, and raising the costs of travel to Americans through increased use of

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2025 Presidential Transition Project

renewables. These goals are not compatible with what should be DOT’s purpose:
to make travel easier and less expensive. That is what the American people want,
and that is what DOT should provide.

AUTHOR'S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but Steven
Bradbury, David Ditch, and Robert Poole deserve special mention. The author alone assumes responsibility for the
content of this chapter, and no views expressed herein should be attributed to any other individual.

— 639 —

Mandate fo

ENDNOTES

r Leadership: The Conservative Promise

U.S. Department of Transportation, 2023 Budget Highlights, p. 1, httos://www.transportation.gov/sites/dot.

gov/files/2022-03/Budget_Hig

hlights_FY2023.pdf (accessed March 3, 2023).

U.S. Department of Transportation, DE/A (Diversity, Equity, Inclusion, and Accessibility] Strategic Plan FY22-

FY26, p. 2, https://\www.transpo
pdf (accessed March 3, 2023).

rtation.gov/sites/dot.gov/files/2022-09/DOT%20DEIA%20Strategic%20Plan.

23 US. Code §§ 601-609, https://www.law.cornell.edu/uscode/text/23 (accessed March 3, 2023).
U.S. Department of Transportation, Office of the Secretary, “Administrative Rulemaking, Guidance, and

Enforcement Procedures,” Final

Rule, Federal Register, Vol. 84, No. 248 (December 27, 2019), pp. 71714-71734,

https://\www.transportation.gov/sites/dot.gow/files/docs/regulations/361831/fed-reg-published-final-admin-

rule.odf (accessed March 3, 202

5).

U.S. Department of Transportation, Build America Bureau, “About the Build America Bureau,” last updated
October 24, 2022, httos://Awww.transportation.gov/buildamerica/about (accessed March 3, 2023).

S. 622, Energy Policy and Conservation Act, Public Law No. 94-163, 94th Congress, December 22, 1995, https://
www.congress.gov/94/statute/STATUTE-89/STATUTE-89-Pg871.pdf (accessed March 3, 2023).

42 U.S. Code Chapter 85, https://www.law.cornell.edu/uscode/text/42/chapter-85 (accessed March 3, 2023).

sites/dot.gov/files/2020-12/Def|

U.S. Department of Transportati

arch 3, 2023).

control_organization_innovatio

https://www.congress.gov/117/p
S. 6, Urban Mass Transportation

U.S. Department of Transportati

02/pdf/2022-07200.pdf (accessed March 10, 2023).
U.S. Department of Transportation, Office of the Secretary, “Defining Unfair or Deceptive Practices,” Final
Rule, Federal Register, Vol. 85, No. 235 (December 7, 2020), pp. 78707-78718, https://www.transportation.gov/

U.S. Department of Transportation, National Highway Traffic Safety Administration, “Corporate Average
Fuel Economy Standards for Model Years 2024-2026 Passenger Cars and Light Trucks,” Final Rule, Federa/

2022), pp. 25710-26092, https://www.govinfo.gov/content/pkg/FR-2022-05-

ining%20Unfair%200r%20Deceptive%20Practices%20Final%20Rule%20-%20

85%20FR%2078707.pdf (accessed March 3, 2023).

U.S. Department of Transportation, Office of the Secretary, “Procedures in Regulating Unfair or Deceptive
Practices,” Final Rule, Federal Register, Vol. 87, No. 22 (February 2, 2022), pp. 5655-5659, https://www.
govinfo.gov/content/pkg/FR-2022-02-02/pdf/2022-01589.pdf (accessed March 3, 2023).

on, Federal Aviation Administration, Budget Estimates Fiscal Year 2023, p. 1,

https://www.transportation.gov/sites/dot.gov/files/2022-04/FAA_Budget_Estimates_FY2023.pdf (accessed

Robert W. Poole, Jr., Organization and Innovation in Air Traffic Control, Hudson Institute Initiative on
Future Innovation, November 2013, https://www.hudson.org/sites/default/files/researchattachments/
attachment/1199/poole_hi_res.pdf (accessed March 3, 2023). Also published subsequently as Reason
Foundation Policy Study No. 431, January 2014, https://reason.org/wp-content/uploads/files/air_traffic_

n.odf (accessed March 3, 2023).

H.R. 3684, Infrastructure Investment and Jobs Act, Public Law No. 117-58, 117th Congress, November 15, 2021,

laws/publ58/PLAW-117publ58.pdf (accessed March 3, 2023).
Act of 1964, Public Law 88-365, 88th Congress, July 9, 1964, https://www.

govinfo.gov/content/pkg/STATUTE-78/pdf/STATUTE-78-Pg302-2.pdf (accessed March 3, 2023).

on, Maritime Administration, “About Us,” last updated March 23, 2022, https://

www.maritime.dot.gov/about-us (accessed March 4, 2023).
H.R. 10378, Merchant Marine Act of 1920, Public Law 66-261, 66th Congress, June 5, 1920, https://govtrackus.

s3.amazonaws.com/legislink/pdf/stat/41/STATUTE-41-Pg988.pdf (accessed March 3, 2023).

— 640 —

DEPARTMENT OF
VETERANS AFFAIRS

Brooks D. Tucker

MISSION STATEMENT

The Department of Veterans Affairs (VA) is the primary provider of health care,
benefits, and memorial affairs for America’s veterans and their families. The VA
has the noble responsibility to render exceptional and timely support and services
with respect, compassion, and competence. The veteran is at the forefront of every
VA process and interaction. The VA must continually strive to be recognized as a

22]

“best in class,” “Veteran-centric”! system with an organizational ethos inspired
by and accountable to the needs and problems of veterans, not subservient to the

parochial preferences of a bureaucracy.

OVERVIEW

At the end of the Obama Administration, the VA was held in low esteem both
by the veterans it served and by the employees who served these former warriors.
Eroding morale caused by the downstream effects of a health care access crisis
in 2014 led to the resignation of Secretary Eric Shinseki and extensive oversight
investigations by Congress from 2015-2016.

By 2020, however, the VA had become one of the most respected U.S. agencies.
This significant progress was due in part to the leadership of Secretary Robert Wilkie
(2018-2021) and his team of political appointees and career senior executives, many
of them veterans, who led the effort to ensure that the VA became “Veteran-centric”
in its governance decisions and fostered a more positive work environment.

This mindset translated into a department that was better attuned to employees’
and veterans’ needs and experiences in the daily operations of health care, benefits,

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Mandate for Leadership: The Conservative Promise

and memorial affairs. During that period, the VA received the largest number of
watershed congressional authorizations to reform its health care and benefits that
it had received since the post-Vietnam War years along with historic increases in
annual appropriations, which have tripled since the last full year of the George W.
Bush Administration.

The current VA leadership team of Biden appointees has adopted some of their
predecessors’ governance processes. However, they have not sustained the previous
Administration’s commitment to a genuine “Veteran-centric” philosophy, most nota-
bly with respect to the delivery of health care, and harbor a bias toward expanding the
unionized federal employee workforce that has not always been aligned with a focus
on “Veteran-centric” care. There also is growing concern in Congress and the veteran
community that the VA is poorly managing and in some cases disregarding provisions
of the VA MISSION [Maintaining Internal Systems and Strengthening Integrated Out-
side Networks] Act of 2018? that codify broad access for veterans to non-VA health care
providers. Efforts to expand disability benefits to large populations without adequate
planning have caused an erosion of veterans’ trust in the VA enterprise.

Additionally, the current VA leadership is focusing very publicly on “social
equity and inclusion” within departmental policy discussions toward ends that
will affect only a small minority of the veterans who use the VA. For the first time,
the VA is allowing access to abortion services, a medical procedure unrelated to
military service that the VA lacks the legal authority and clinical proficiency to
perform. In addition to continuing the grotesque culture of violence against the
child in the womb, these sociopolitical initiatives and ideological indoctrinations
distract from the department’s core missions.

DEPARTMENTAL HISTORY

Following the Civil War, state veterans homes were established to provide med-
ical and hospital treatment for all injuries and diseases. When the United States
entered World War I in 1917, “Congress established a new system of Veterans
benefits, including programs for disability compensation, insurance for service
personnel and Veterans, and vocational rehabilitation for the disabled”? that was
overseen by three different federal programs: the Veterans Bureau, the Department
of the Interior’s Bureau of Pensions, and the National Home for Disabled Volunteer
Soldiers. In 1921, Congress combined those programs into the Veterans Bureau.
Following World War II, a national VA hospital system, much of which remains
operational today, was established to care for millions of returning veterans.

Following the Vietnam War, the VA’s federally owned and operated hospital
network expanded again to meet the needs of the volunteer and draftee population.
In the past two decades, the VA has purposely transitioned to leasing medical prop-
erties rather than building expensive new facilities that can take years to complete
and often experience budget overruns. As the nature of health care has evolved

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2025 Presidential Transition Project

with a growth in same-day surgical procedures and outpatient care, so has the VA,
and in 2018 Congress added access to private-sector urgent care outlets as one of
the VA’s health care benefits.

Today, the VA operates 172 inpatient VA Medical Centers (VAMCs), which are
an average of 60 years old, and 1,113 Community Based Outpatient Clinics (CBOCs),
which are newer facilities designed to meet the needs of veterans closer to home.
The VA also manages a Community Care Network (CCN) through contracts with
Optum and TriWest, third-party health care administrators responsible for build-
ing and maintaining a robust population of community providers to meet the needs
of veterans referred for care outside of the VA system. Currently, approximately
6.4 million veterans out of 18 million nationally (and out of the 9.1 million who are
enrolled) use the VA for health care; the remainder use employer-sponsored plans,
Tricare, Medicare, and Medicaid.

The disability benefits system evolved significantly in the years between the
Cold War era and the global war on terrorism, a period when the VA enrolled large
numbers of veterans from World War II, Korea, and Vietnam who were seeking
disability benefits and health care. Disability compensation is the largest VA benefit,
but there also are dozens of others, the next largest of which are the GI Bill and
the Home Loan Guaranty. These benefits are administered through 56 Regional
Benefits Offices (RBOs) and hundreds of satellite sites around the country.

The Agent Orange Act of 1991‘ significantly expanded the scope of disability ben-
efits for those who had deployed to Vietnam, and the cost of those benefits began to
increase dramatically as the Vietnam generation of veterans aged and began to expe-
rience adverse health conditions, some of which were presumed to have been caused
by defoliant chemicals used in Southeast Asia. In 2016 and 2017, a burdensome
backlog of appeals of denied disability claims from multiple wartime generations—a
backlog numbering in the hundreds of thousands—led to a joint effort by the VA, Vet-
eran Service Organizations (VSOs), and Congress to pass legislation that streamlined
appeal processes. Implemented in 2017, this historic “good governance” success has
helped the VA to reduce the number of these appeals dramatically.

The Sergeant First Class Heath Robinson Honoring Our Promise to Address
Comprehensive Toxics (PACT) Act of 2022° addressed adverse health outcomes
presumed to be the result of veterans’ exposure to airborne toxins during the global
war on terrorism and further expanded disability benefits to the most recent gen-
eration of veterans. These ambitious authorities, like the 1991 authorities, have
the potential to overwhelm the VA’s ability to process new disability claims and
adjudicate appeals. Currently, the VA is seeking to hire large numbers of personnel
to process these claims while exploring the use of an automated process to accel-
erate claims reviews and decisions. The ever-present lag in the hiring and training
of new employees could result in major problems with the timely adjudication of
benefits well into the next Administration in 2025.

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Mandate for Leadership: The Conservative Promise

In sum, the VA for the foreseeable future will experience significant fiscal,
human capital, and infrastructure crosswinds and risks. Budgets are at historic
highs, and with a workforce now above 400,000, the VA is contending with a
lack of new veteran enrollees to offset the declining population of older veterans.
Recruitment of medical and benefits personnel has become more challenging.
Veterans are migrating from the northern states to the southern and western
states for retirement and employment. Meanwhile, VA information technol-
ogy (IT) is struggling to keep pace with the evolution of patient care and record
keeping. Consequently, VA leaders in the next Administration must be wise and
courageous political strategists, experienced managers to run day-to-day oper-
ations more effectively, innovators to address the changing veteran landscape,
and agile “fixers” to mitigate and repair systemic problems created or ignored
by the present leadership team.

VETERANS HEALTH ADMINISTRATION (VHA)

Needed Reforms

e Rescind all departmental clinical policy directives that are contrary to
principles of conservative governance starting with abortion services
and gender reassignment surgery. Neither aligns with service-connected
conditions that would warrant VA’s providing this type of clinical care, and
both follow the Left’s pernicious trend of abusing the role of government to
further its own agenda.

e Focus on the effects of shifting veteran demographics. At least during the
next decade, the VA will experience a significant generational shift in its
overall patient population. Of the approximately 18 million veterans alive
today, roughly 9.1 million are enrolled for VA health care, and 6.4 million of
these enrollees use VA health care consistently. These 6.4 million veterans
are split almost evenly between those who are over age 65 and those
who are under age 65, but the share of VA’s health care dollars is spent
predominantly in the over-65 cohort. That share increases significantly as
veterans live longer and use the VHA system at a higher rate.

VHA enrollments of new users are increasingly at risk of being exceeded by
the deaths of current enrollees, primarily because significant numbers of
the Vietnam generation are reaching their life expectancy. The generational
transition from Vietnam-era veterans to post-9/11 veterans will take

several years to complete. The ongoing demographic transition is a catalyst
for needed assessments of how the VA can improve the delivery of care

to anumerically declining and differently dispersed national population

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2025 Presidential Transition Project

of veterans—a population that is more active, reaching middle age or
retirement age, and migrating for lifestyle and career reasons.

At the center of the VHA’s evolution during this generational transition
is an ongoing tension, some of it politically contrived, between Direct
Care for Veterans provided from inside the VHA system and Community
Care for Veterans who are referred to private providers participating in
the VHA’s two Community Care Networks (CCNs). In recent years, the
budget for Community Care has grown as demand from veterans has
risen sharply, sometimes outpacing the budgets for Community Care at
individual VAMCs.

The Trump Administration made Community Care part of its “Veteran-
centric” approach to ensure that veterans would be able to participate more
fully in their health care decisions and have options if or when the VHA was
unable to meet their needs. The Biden Administration has watered down
that effort, has sought various procedural ways to slow the rate of referrals
to private doctors, and at some facilities is reportedly manipulating the
Community Care access standards required by the VA MISSION Act of 2018.
If the makeup of Congress is favorable in 2025, the next Administration
should rapidly and explicitly codify VA MISSION Act access standards

in legislation to prevent the VA from avoiding or watering down the
requirements in the future.

First and foremost, a veterans bill of rights is needed so that veterans and
VA staff know exactly what benefits veterans are entitled to receive, witha
clear process for the adjudication of disputes, and so that staff ensure that
all veterans are informed of their eligibility for Community Care. Currently,
veterans are not routinely and consistently told that they are eligible for
Community Care unless they request information or are given a referral.

To strengthen Community Care, the next Administration should create new
Secretarial directives to implement the VA MISSION Act properly. Sections

for consideration and areas for reform include the following:

1. Sections 101 and 103 (Community Care eligibility for access standards
and the best medical interest of the veteran).

2. Section 104 (Community Care access standards and standards for
quality of care).

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Mandate for Leadership: The Conservative Promise

3. Section 121 (developing and administering an education program that
teaches veterans about their health care options available from the
Department of Veterans Affairs).

4. Section 152 (returning the Office for Innovation of Care and Payment to
the Office of Enterprise Integration with a joint governance process set
up with the VHA).

5. Section 161 (overhauling Family Caregiver Program expansion, which
has gone poorly, so that it focuses on consistency of eligibility and
awareness that the most severely wounded or injured may require the
program indefinitely).

Require the VHA to report publicly on all aspects of its operation, including
quality, safety, patient experience, timeliness, and cost-effectiveness, using
standards similar to those in the Medicare Accountable Care Organization
program so that the government may monitor and achieve continuous
improvement in the VA system more effectively.

Encourage VA Medical Centers to seek out relevant academic and private-
sector input in their communities to improve the overall patient experience.

Budget

Conduct an independent audit of the VA similar to the 2018 Department of
Defense (DOD) audit to identify IT, management, financial, contracting, and
other deficiencies.

Assess the misalignment of VHA facilities and rising infrastructure costs. The
VHA operates 172 inpatient medical facilities nationally that are an average of
60 years old. Some of these facilities are underutilized and inadequately staffed.
Facilities in certain urban and rural areas are seeing significant declines in the
veteran population and strong competition for fresh medical staff.

In 2018, Congress authorized an Asset Infrastructure Review (AIR) of
national VHA medical markets to provide insight into where the VA
health care budget should be responsibly allocated to serve veterans most
effectively. However, the Senate Veterans Affairs Committee lacked the
political will to act on the White House’s nominations of commission
members, and this ultimately led to termination of the AIR process.

The next Administration should seek out agile, creative, and politically
acceptable operational solutions to this aging infrastructure status quo,

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2025 Presidential Transition Project

reimagine the health care footprint in some locales, and spur a realignment
of capacity through budgetary allocations. Specifically:

1. Embrace the expansion of Community Based Outpatient Clinics (CBOCs) as
an avenue to maintain a VA footprint in challenging medical markets without
investing further in obsolete and unaffordable VA health care campuses.

2. Explore the potential to pilot facility-sharing partnerships between the
VA and strained local health care systems to reduce costs by leveraging
limited talent and resources.

Personnel

Extend the term of the Under Secretary for Health (USH) to five years.
Additionally, authority should be given to reappoint this individual for a
second five-year term both to allow for continuity and to protect the USH
from political transition.

Establish a Senior Executive Service (SES) position of VHA Care System
Chief Information Officer (CIO), selected by and reporting to the chief of the
VHA Care System with a dotted line to the VA CIO.

Identify a workflow process to bring wait times in compliance with VA
MISSION Act-required time frames wherever possible.

1. Assess the daily clinical appointment load for physicians and clinical
staffin medical facilities where wait times for care are well outside of
the time frames required by the VA MISSION Act.

2. Require VHA facilities to increase the number of patients seen each day
to equal the number seen by DOD medical facilities: approximately 19
patients per provider per day. Currently, VA facilities may be seeing as
few as six patients per provider per day.

3. Consider a pilot program to extend weekday appointment hours and
offer Saturday appointment options to veterans if a facility continues to
demonstrate that it has excess capacity and is experiencing delays in the
delivery of care for veterans.

4. Identify clinical services that are consistently in high demand but

require cost-prohibitive compensation to recruit and retain talent, and
examine exceptions for higher competitive pay.

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Mandate for Leadership: The Conservative Promise

Assess the medical facilities where Community Care is readily
available but referrals for Community Care are below the averages in
other similar markets, referrals expiring are above the average, and/
or canceled appointments are above the average. Identify reasons
and factors and consider possible ways to improve timeliness and
responsiveness for veterans.

Further explore how to leverage telehealth to reduce personnel costs
across the enterprise and serve veterans. Continue to pursue expansion
of broadband services to remote and rural areas.

Assess recruitment and retention in highly competitive medical markets
to identify common limiting factors for attracting high-demand,
specialized occupations.

Consider aggressively recruiting retired physicians who desire to
serve veterans.

Consider expanding VA tuition assistance in exchange for reciprocal
service in rural or understaffed VAMCs.

Examine the surpluses or deficits in mental health professionals
throughout the enterprise, recognizing that the department needs a
blend of social workers, therapists, psychologists, and psychiatrists with
a focus on attracting high-quality talent.

Conduct a high-priority assessment of Electronic Health Record (EHR)
transition delays and functionality problems. VA innovation in health

care for the next 20 years and beyond will rest squarely on the timely
implementation of the new VHA EHR in coordination with the DOD’s
parallel pacing effort. The VA’s EHR rollout has been blocked by technical
delays at local facilities where personnel have raised safety concerns and

infrastructure has not been modernized to accept the new system.

VETERANS BENEFITS ADMINISTRATION (VBA)

Needed Reforms

The most evident and ongoing concern is the complexity of benefits, which

can lead to confusion for the veteran and, if not mitigated early in the veteran’s
interactions, long-term distrust of and animosity toward the VA. Wholesale ben-
efits reform is unnecessary and politically a “third rail,” but effective managerial

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2025 Presidential Transition Project

approaches and technology tools that currently exist in the private sector could
be employed to improve existing VBA activities.

This problem is most pronounced in the disability claims process, which needs
more and better management attention focused on streamlining the procedures
involved in processing claims and administering benefits. The VA must improve
timeliness of claim adjudication and benefits delivery: Veterans want the VBA
to provide timely responses to requests for benefits support, render empathetic
customer service and understandable explanations of those benefits, and deliver
those benefits without frustrating delays (weeks, not months).

e Identify performance targets for benefits, report publicly on actual
performance each quarter, and use these metrics to drive consistent
improvement.

e Develop anew pilot “Express 30” commitment for a veteran’s first fully
developed disability compensation claim and organize the VBA to complete
the first claim in 30 days.

e Hire more private companies to perform disability medical examinations.
Delays in completing the examinations could be eliminated with more
external capacity.

e Increase automation. Hiring additional staff to process claims is costly,
is inflexible, and has yielded mixed results. Attempting to change laws
and regulations simply to adjudicate claims would be a herculean effort
given their complexity. The best way to provide benefits faster and more
accurately is by using technology to perform most of the work. Technology
currently exists in the private sector, but the VBA lacks the expertise
to use it. This would be more of an organizational challenge than a
technology hurdle.

e Reduce improper payment and fraud. About $500 million is improperly
paid out each year. Better tools, training, and management could reduce this
substantially, but rule changes at the departmental level would be needed.

Budget

The VA’s Schedule for Rating Disabilities (VASRD) has assigned disability
ratings to a growing number of health conditions over time; some are tenuously
related or wholly unrelated to military service. The further growth in presumptive
service-connected medical conditions pursued by Congress and Veteran Service
Organizations, begun with Agent Orange and most recently for Burn Pits/Airborne

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Mandate for Leadership: The Conservative Promise

Toxins, has led to historic increases in mandatory VBA spending in recent years.
The VA has a time-phased plan to reassess the VASRD and its ratings for com-
pensation, but this internal process can be slow and laborious, requires Office of
Management and Budget (OMB) approvals, and can become politically charged
both in Congress and with VSOs.

e Thenext Administration should explore how VASRD reviews could be
accelerated with clearance from OMB to target significant cost savings from
revising disability rating awards for future claimants while preserving them
fully or partially for existing claimants.

e The VBA’s Information Technology top-line budget should be reexamined
and reassessed in light of the need for expanded automation across
the enterprise.

e Traditionally, VHA captures the large majority of VA IT funding. The VBA
needs to make the case for a larger IT budget with clear requirements to
support that request.

Personnel

e Pursue reforms of the Human Capital Management process and operations
within the VBA to build a more blended workforce with more contractors to
process claims. This would free federal employees to perform other duties
and be involved solely with the final decision to award benefits.

e Improve the VBA acquisition workforce. The VBA needs more world-class
contractor support. Currently, few of the top companies have contracts with
the VBA, and the VBA needs to conduct more outreach to the private sector
through senior leader engagement and industry conferences.

e To identify more effective and efficient ways to complete claims, establish a
knowledge exchange program with top-tier private-sector companies that
do similar work. The VBA is fundamentally a financial services organization.
A significant amount of its work has a private-sector analogue that could be
leveraged to improve service to veterans.

e For most ofits existence, the VBA has been a risk-averse, insular, paper-based
organization, implementing technology only over the past decade. This
insularity has led to a predominantly “build it ourselves” approach, partly
because VBA staff has limited experience or insight into current private-
sector tools and methods and partly because the VBA struggles to compete

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2025 Presidential Transition Project

with the VHA for IT funding. Senior executive leadership needs more
innovators and trail blazers—qualities that have sometimes been lacking

in the VBA’s senior ranks. Recruiting a more relevantly knowledgeable and
technologically savvy team, along with robust political control of the VA, could
bring about better solutions to the VBA’s workflow challenges.

HUMAN RESOURCES AND ADMINISTRATION (HRA)

Needed Reforms
e Rescind all delegations of authority promulgated by the VA under the prior
Administration.

e Transfer all career SES out of PA/PAS-designated positions on the first day
and ensure political control of the VA.

e =Take aclose and analytically critical look at where hybrid and remote work
is anet positive as a functional necessity and where in-person collaboration
and presence will help to instill a strong work ethic and a more cohesive
environment for productivity from the Office of the Secretary across the
headquarters enterprise.

The COVID-19 pandemic spurred a significant shift to hybrid and telework
options for large segments of the staff in the Washington headquarters, in its sat-
ellites, and at some VBA Regional Offices. The “remote work” expectation has
been amplified and formalized within the Biden Administration team at VA to
the extent that the current Secretary, Deputy Secretary, and their staffs are not “in
office” as a matter of a routine presence while VA staff in Washington, D.C., have
limited in-person meetings, relying more frequently on video conference calls. The
short-term and long-term effects of this policy on the department are unknown,
but generally, the policy may be undermining the cohesiveness and competencies
of some staff functions and diluting general organizational accountability and
responsiveness.

Budget

e Expedite the acquisition of anew Human Resources Information
Technology (HRIT) system. The current system is not user-friendly; has
minimal fusion, middle-ware capacity; and is not conducive to data driven
personnel decisions. Personnel data needs to be organized and managed
to its full potential. The HRIT system, associated databases, and other

“shadow” personnel systems have no shortage of data; the problem comes

with effective management of the data.

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Mandate for Leadership: The Conservative Promise

Broaden pay and benefits in critical VA skill sets (beyond medical care
occupations) to be more competitive with private-sector industry. IT,
acquisition, cyber, and economists are some examples of skill sets that
are difficult for the VA to recruit, largely because of the limitations of
federal pay scales.

Continue to maximize the use of new VA hiring and pay authorities provided
by Congress in the RAISE Act® and PACT Act’ as well as existing authorities in
student loan forgiveness and the Public Service Loan Forgiveness program.

Personnel

Foster a culture that is mission (veteran) driven, alert, engaged, and
habitually responsive to the veteran, and structure an environment that
promotes a flexible and agile workplace.

Increase employee satisfaction/experience to improve recruitment and
retention of VA personnel. Go beyond the traditional focus on the extrinsic
(monetary pay and bonuses) and seek creative ways to instill teamwork,
loyalty, and pride.

Train leaders and managers to promote an energized and productive
workplace culture and reward those who do it well. Ensure that senior
leaders (SES) set the proper example.

Focus more attention on hiring veterans and military spouses. The
percentage of veterans employed at VA has been declining.

Support the White House Office of Presidential Personnel (PPO) in
identifying a fully vetted roster of candidates to assume all key positions at
VA well ahead of formal nominations. The VA is the second-largest federal
agency, yet it is authorized a woefully small number of PA/PAS positions
when compared to other agencies of lesser size. Congress and the Office of
Personnel Management should be engaged on ways to provide authorities
for a higher number of non-career PA positions. The White House PPO can
be inclined to discount the VA’s importance, but given the political attention
that VA can generate for Congress and the media, PPO should understand
the importance of finding talented political appointees to serve at VA.

Increase the number and utilization of Limited Term Appointment Senior

Executive Service positions for up to three years to work on special projects
to ensure talent refreshment, talent acquisition, and flexibility.

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2025 Presidential Transition Project

Manage the relationship with organized labor effectively and proactively.

Ensure that any agenda that includes labor/civil service reform in the VA
has aclear direction from the Secretarial level, support from the General
Counsel, alignment with the Assistant Secretary for Human Resources
and Administration, and a unified and strong political will to carry it out.
Without those elements, labor reforms are very difficult to accomplish.

Ensure that each senior leader in the process gets buy-in from reform-
minded career employees willing to accept and support change. Those
mid-level and senior-level managers exist, but they will need to be
identified early and shown trust and confidence.

Ensure that the White House communicates the labor reform agenda
swiftly. Trump Administration executive orders on civil service reform
(official time, government-furnished office space) were issued too late,
and departments and agencies were not prepared to execute them.

Anticipate the inevitable opportunities for legal challenges from
organized labor, and be prepared for them to happen and be dragged
out—which makes early, decisive timing all the more important.

Ensure that the White House is prepared to support a concerted
and deliberate effort on implementation to avoid perceptions of a
disconnected strategy and disaggregated effort.

Remain mindful of which labor contracts end, when they end, and what
the agency’s goals for renegotiation are. If not done effectively, contract
end dates will be missed or lack notification. It is therefore essential to
have a clear strategy with respect to what leadership wants from a new
contract: Do not make the perfect the enemy of the good in contract
negotiations.

Work with Congress to sunset the Office of Accountability and
Whistleblower Protection (OAWP). OAWP was well intentioned when
formed, but it is redundant with the activities of supervisors as well as

equal employment opportunity, Office of the Inspector General, Office of

Special Counsel, and other policies, programs, and procedures for holding

employees accountable. This redundancy results in lengthy investigations,

gaps in coverage, and an overall ineffective method of employee and

supervisor accountability.

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Mandate for Leadership: The Conservative Promise

e Consider decoupling HRA and the Office of Security and Preparedness
(OSP). When Congress directed that the OAWP be established, it did not
include authorities for a new Assistant Secretary position; consequently, the
OSP was combined with HRA to free a PAS position. The functions of HRA
and OSP are dissimilar and thus create an organization that is difficult to
staff with the talent needed to execute both missions effectively.

AUTHOR’S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in

the 2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume,

but Darin Selnick, Paul R. Lawrence, and Christopher Anderson deserve special mention. The author alone
assumes responsibility for the content of this chapter, and no views expressed herein should be attributed to any
other individual.

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2025 Presidential Transition Project

ENDNOTES

1. US. Department of Veterans Affairs, Veterans Health Division, VHA Directive 1003, “VHA Veteran Patient
Experience,” April 14, 2020, pp. 1 and B-1.

2. §.2372, VA Mission Act of 2018, Public Law No. 115-182, 115th Congress, June 6, 2018, https://www.congress.
gov/115/plaws/publl82/PLAW-1I5publ182. pdf (accessed January 30, 2023).

3. U.S. Department of Veterans Affairs, VA History Office, “VA History,” last updated May 27, 2021, https://www.
va.gov/HISTORY/VA_History/Overview.asp (accessed January 28, 2023).

4. 38US. Code § 1116, https://www.law.cornell.edu/uscode/text/38/1116 (accessed January 28, 2023).

5. §. 3373, Sergeant First Class Heath Robinson Honoring Our Promise to Address Comprehensive Toxics Act of
2022 (Honoring Our PACT Act of 2022), Public Law No. 117-168, 117th Congress, August 10, 2022, https://www.
congress.gov/117/plaws/publ168/PLAW-117publl68.pdf (accessed January 28, 2023).

6. H.R. 247], Consolidated Appropriations Act, 2022, Public Law No. 117-103, 117th Congress, March 15, 2022,
Division S, Title |, httos://www.congress.gov/117/plaws/publ103/PLAW-117publ103.pdf (accessed March 18,
2023). Known variously as the Department of Veterans Affairs Nurse and Physician Assistant Retention and
Income Security Enhancement Act and the VA Nurse and Physician Assistant RAISE Act.

7. See note 5, supra.

— 655 —

Section Four

THE ECONOMY

he next Administration must prioritize the economic prosperity of ordi-
nary Americans. For several decades, establishment “elites” have failed
the citizenry by refusing to secure the border, outsourcing manufacturing
to China and elsewhere, spending recklessly, regulating constantly, and generally
controlling the country from the top down rather than letting it flourish from the
bottom up. The proper role of government, as was articulated nearly 250 years
ago, is to secure our God-given, unalienable rights in order that we might enjoy
the pursuit of happiness, the benefits of free enterprise, and the blessings of liberty.
Finding the right approach to trade policy is key to the fortunes of everyday
Americans. In Chapter 26, president of the Competitive Enterprise Institute Kent
Lassman and former White House director of trade and manufacturing policy Peter
Navarro debate what an effective conservative trade policy would look like. Lass-
man argues that the best trade policy is a humble, limited-government approach
that would encourage free trade with all nations. He maintains that aggressive
trade policies involve an increased government role that future leftist Administra-
tions will utilize to push “climate change” and “equity”-based activism. Focusing
more on gross domestic product (GDP) growth than on median income, he writes
that “people mistakenly believe that U.S. manufacturing and the U.S. economy
are in decline” when in truth “American manufacturing output is currently at an
all-time high.” Meanwhile, we continue to experience “record-setting real GDP”
despite our “long-run decline in manufacturing employment.”
Lassman does not think that an aggressive U.S. trade policy would lead to more
manufacturing jobs. Rather, he writes, “Federal Reserve research shows” that the

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Mandate for Leadership: The Conservative Promise

Trump Administration’s steel tariffs, and the retaliatory tariffs levied by other
nations in response, “have cost about 75,000 manufacturing jobs while creating
only about 1,000 jobs in the steel industry.” Furthermore, he writes that “pro-
tectionism and similar progressive policies tend to weaken American security.”
Lassman maintains that “trade creates peace,” and if China weren’t so reliant upon
trade with the U.S., it would be “much more unstable and dangerous.” He thinks
American influence in China—“Internet memes, fashion, movies”—can “play a
vital role in helping to turn China from an authoritarian threat into a freer and
less hostile power.”

Ultimately, Lassman believes that we should lower or repeal tariffs—including
eliminating “the destructive Trump-Biden tariffs”—in order to make goods more
affordable for Americans. He thinks free trade will improve our economy, enhance
our national security, and keep future left-leaning Congresses from insisting that
future left-leaning Presidents “negotiate for as many trade-unrelated provisions
as possible to benefit labor and green constituencies.”

Navarro disagrees with Lassman almost across the board. He writes, “Trade policy
can and must play an essential role in an American manufacturing and defense indus-
trial base renaissance,” which he says is crucial to our country’s future. But two forces
in particular “are pushing America in the opposite direction.” First, the World Trade
Organization’s (WTO) “most favored nation” rules encourage our trade partners to
adopt high tariffs, which lead to our “chronic” trade deficits and make us “the globe’s
biggest trade loser and victim of unfair, unbalanced, and non-reciprocal trade.” For
example, Navarro writes, tariffs on imported automobiles are 2.5 percent in the US.,
10 percent in the European Union, and 15 percent in China. Second, China’s “eco-
nomic aggression” in the form of “tariffs, nontariff barriers, dumping, counterfeiting
and piracy, and currency manipulation” further weakens our “manufacturing and
defense industrial base even as the fragility of globally dispersed supply chains has
been brought into sharp relief by the COVID-19 pandemic.”

In contrast to Lassman, Navarro thinks that “trade deficits matter a great deal.”
He writes that “offshoring not only suppresses the real wages of American blue-col-
lar workers and denies millions of Americans the opportunity to climb up the rungs
of the ladder to the middle class,” but it also “raises the specter of a manufacturing
and defense industrial base that, unlike our experience in World Wars I and II,
will not be able to provide the weapons and matériel that would be needed should
America enter another major world war.” Also, China controls “much of the world’s
pharmaceutical production and supply chains.” It is therefore essential, he writes,
that our trade policy be guided by “the principle of reciprocity,” whereby we coax
other countries into lowering their trade barriers if possible and raise ours as nec-
essary. Moreover, he says we should “decouple” our economy from China’s.

China’s goal, Navarro says, is “to shift the world’s manufacturing and supply
chains” to its soil, thereby strengthening its “defense industrial base and associated

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2025 Presidential Transition Project

warfighting capabilities.” He writes, “Every year, more than 300,000 Communist
Chinese nationals attend U.S. universities or are hired at U.S. national laborato-
ries, innovation centers, incubators, and think tanks.” Huawei, “an instrument of
Chinese military espionage,” is now partnering with UC Berkeley on research with
“important future military applications.” China is also engaged in what Warren
Buffett calls “conquest by purchase,” as it uses revenues from its trade surpluses
“to buy American real estate, companies, and financial assets.” In sum, Navarro
believes our current trade policy enriches our allies and adversaries while hurting
us, weakens our industrial base while strengthening China’s, and shortchanges
“Main Street manufacturers and workers.” Such non-reciprocal “free” trade is
slowly undermining our capabilities and our freedom.

Asmall component of trade policy involves the Export-Import Bank, and Jenni-
fer Hazelton and Veronique de Rugy debate its merits in Chapter 23. In support of
the bank, Hazelton writes, “EXIM provides financing only when the private sector
will not.” She says, “Export credit is a strategy weapon in China’s whole-of-govern-
ment approach to enhance its global power.” China provided an estimated “$500
billion in export credit” in 2018, “approaching in that one year the total amount of
financing EXIM has provided in its 90-year history.” Hazelton argues that when
large American companies can get a loan from EXIM rather than having to meet
the demands of export credit agencies in Europe or elsewhere, it helps American
small businesses, too. She writes that the U.S. “would be foolish to abandon this
field of play.”

Opposing the bank, de Rugy writes, “EXIM operates in effect as a protectionist
agency that picks winners and losers in the market by providing political privileges
to firms that are already well-financed.” She denies it promotes exports and argues
it hurts small businesses, which often have to compete against large businesses
that are able to get the loans. She writes that it also helps foreign companies, such
as state-run China Air, that buy U.S. exports from American companies such as
Boeing. The bottom line, she says, “is that the Bank should be abolished.”

In Chapter 21, former assistant secretary of commerce Thomas F. Gilman
describes the Department of Commerce as dominated by career staff who are unin-
terested in implementing the President’s priorities. The department clearly needs
far more political leadership, including at the Census Bureau, as Gilman notes.
The Census Bureau, unlike much of the federal government, has a constitution-
ally required mission. Yet the 2020 Census was at least somewhat compromised
by overly risk-averse COVID policies that prevented census field representatives
from going door-to-door for much of that year. The Census Bureau’s website, one
of the worst in the federal government, buries crucial statistics where only aca-
demics or advocates are likely to find them. In addition, Gilman writes that a new
Administration should ensure that the Bureau of Economic Affairs, also housed at
Commerce, “conducts its statistical analysis in a consistent and objective manner.”

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Mandate for Leadership: The Conservative Promise

Moreover, the International Trade Administration—which “is centrally placed to
craft and implement U.S. trade policy”—should counter “the malign influence of
China and other U.S. adversaries” and strongly “defend against trade violations.”

In Chapter 22, William L. Walton, Stephen Moore, and David R. Burton note
that under the Biden Administration, the Treasury Department has failed to
achieve any of the agency’s core objectives. Under the leadership of Secretary Janet
Yellen, Treasury has placed “equity” and “climate change” among its top five pri-
orities. The next Administration must act decisively to curtail activities that fall
outside of Treasury’s mandate and primary mission. Treasury must refocus on its
core mission of promoting economic growth, prosperity, and economic stability.
The authors add that “Treasury should make balancing the federal budget a mis-
sion-critical objective.”

The authors propose legislation to reform the tax code, writing,

Tax policy has a powerful impact on the economy. The Treasury Department
should develop and promote tax reform legislation that will promote
prosperity. To accomplish this, tax reform should improve incentives to
work, save, and invest. This, in turn, is accomplished primarily by reducing
marginal tax rates, reducing the cost of capital, and broadening the tax base to
eliminate tax-induced economic distortions by eliminating special-interest
tax credits, deductions, and exclusions. Tax compliance costs will decline
precipitously if the tax system is substantially simplified. The Treasury
Department should also promote tax competition rather than supporting an
international tax cartel.

Chapter 22 includes proposals to reduce the intrusiveness and increase the
accountability of the Internal Revenue Service.

The chapter also explains how the interagency Committee on Foreign Invest-
ment in the United States (CFIUS), chaired by Treasury, should realign its priorities
to meet the United States’ current foreign policy threats, especially from China. It
explains how Treasury’s Financial Crimes Enforcement Network, which manages
the anti-money laundering/countering the financing of terrorism (AML-CFT)
programs, can be improved to reduce the burden on small firms and improve the
effectiveness of the AML-CFT regime.

In Chapter 25, Karen Kerrigan describes the Small Business Administration
(SBA) as a “sprawling, unaccountable agency” replete with “waste, fraud, and mis-
management” and guilty of “mission creep.” Moreover, its “initiatives aimed at

‘inclusivity’ are in fact creating exclusivity and stringent selectivity in deciding
what types of small businesses and entities can use SBA programs.” According to
Kerrigan, the Office of Advocacy “is one of the bright spots within the SBA that a
conservative Administration could supercharge to dismantle extreme regulatory

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2025 Presidential Transition Project

policies and advance limited-government reforms that promote economic free-
dom and opportunity.” She recommends that it receive a big increase in funding
and staffing and then undertake “a research agenda that includes measuring the
total cost that federal regulation imposes on small businesses.” This would be one
important step in making sure that “the SBA under a conservative Administration
would meet the needs of America’s small-business owners and entrepreneurs, not
special interests.”

Former White House director of the domestic policy council Paul Winfree
writes in Chapter 24 that the Federal Reserve actually causes “inflationary and
recessionary cycles.” He says, “A core problem with government control of mone-
tary policy is its exposure to two unavoidable political pressures: pressure to print
money to subsidize government deficits and pressure to print money to boost the
economy artificially until the next election.” The Fed has also added a “moral
hazard” due to its “history of bailing out private firms when they engage in excess
speculation.” At a “minimum,” Winfree writes, “full employment” should be elim-
inated from the Federal Reserve’s mandate, “requiring it to focus on price stability
alone.” The Fed should not be allowed to incorporate “environmental, social, and
governance factors into its mandate.” It should be compelled “to specify its target
range for inflation.” Its last-resort lending practices, “which are directly respon-
sible for ‘too big to fail,” should be curbed. Its mission, and alternatives to the Fed,
should be explored by acommission created for that purpose. And a central bank
digital currency, which “would provide unprecedented surveillance and potential
control of financial transactions,” should be rejected.

Even more ambitiously, Winfree suggests that the next Administration should
think about proposing legislation that would “effectively abolish” the Federal
Reserve and replace it with “free banking,” whereby “neither interest rates nor
the supply of money” would be “controlled by government.” Free banking would
produce a “stable and sound” currency and a “strong” financial system, “while
allowing lending to flourish.” Alternatively, Winfree writes, the next Administra-
tion should “consider the feasibility of a return to the gold standard.”

— 661 —

DEPARTMENT OF
COMMERCE

Thomas F. Gilman

he Department of Commerce is charged with promoting economic growth,

innovation, and competitiveness while providing the data that American

businesses need to succeed. Intended to serve with clarity of purpose as
the voice of business in any President’s Cabinet, the Department of Commerce has
suffered from decades of regulatory capture, ideological drift, and lack of focus. One
long-standing joke maintains that the department, with its lack of coherence, is a
holding company for the parts of the federal government that could not be housed
elsewhere. Thus, in the 1990s, calls emerged to abolish the department and either
spin off, zero-out, or consolidate its functions among other entities.’

At the same time, the department has a higher profile now than perhaps ever
in its history. It possesses key tools to address decades of poor decision-making
in Washington and is central to any plan to reverse the precipitous economic
decline sparked by the Biden Administration and to counter Communist China.
Both assertions can be equally true, that the department possesses the expertise,
programs, and authorities that will be crucial to the success of a conservative
presidency and that its role in the federal bureaucracy would benefit from
streamlining and reform.

Many programs at the Department of Commerce overlap in whole or part with
other governmental programs, and consolidating and streamlining these could
increase both accountability and return on taxpayer investment. Any exercise in
government-wide budgeting and reform should review the department with an eye
toward consolidation, elimination, or privatization that examines the efficiency,
effectiveness, and underlying philosophy of each individual component. Though

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Mandate for Leadership: The Conservative Promise

not an exhaustive set of proposals, the next conservative President should con-
sider whether:

e The International Trade Administration (ITA) and parts of the Bureau of
Industry and Security (BIS) should be streamlined and moved to the Office
of the U.S. Trade Representative (USTR), along with the Development
Finance Corporation; the U.S. Trade and Development Agency; the Export-
Import Bank; and other trade-related programs spread across the federal
government—as well as considering whether many of these programs
should exist within the federal government;

e The Economic Development Administration’s grant programs, which
are among a broad set of duplicative and overlapping federal economic
development grant programs, should be consolidated with other programs
and/or eliminated;

e The Bureau of Economic Analysis and Census Bureau, as well as the
Department of Labor’s Bureau of Labor Statistics, should be consolidated
into amore manageable, focused, and efficient statistical agency;

e The US. Patent and Trademark Office (USPTO) should be made into a
performance-based organization under the Office of Management and
Budget (OMB);

e Alternatively, the USPTO should be consolidated with the National
Institute of Standards and Technology (NIST) in a new USS. Office of
Patents, Trademarks, and Standards, with all non-mission-critical research
functions eliminated or moved to other, more focused, federal agencies; and

e The National Oceanographic and Atmospheric Administration (NOAA)
should be dismantled and many of its functions eliminated, sent to other
agencies, privatized, or placed under the control of states and territories.

Almost every element of the department can be viewed through this lens, but
with today’s political reality and multiple competing congressional committee
jurisdictions, drastic structural change to the department is neither imminent
nor likely. Thus, this chapter largely accepts the baseline of today’s department
and proposes a bold, but achievable, set of proposals for an incoming conservative
Administration.

Whatever the imperfections of the Department of Commerce, it is blessed with
many quality civil servants and strong statutory authorities that, directed properly,

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2025 Presidential Transition Project

can help ensure U.S. success in 2025 and beyond. With that in mind, this chapter
focuses primarily on policy, strategy, and occasionally tactics that are either imme-
diately implementable under strong leadership or are critical to mission success.

OFFICE OF THE SECRETARY

The Office of the Secretary (OS) is somewhat of a misnomer, as very few of the
thousands of employees working in the office are dedicated to staffing the secretary
and implementing Administration priorities. Rather, OS’s budget and full-time
equivalents have increasingly been allocated to fulfill financial, human resources,
administrative, information technology, contracting, and facilities functions, using
outdated and inefficient systems. The Trump Administration began implement-
ing key changes, such as updating financial management tools, but more must be
done to digitize and modernize the department’s processes to free resources for
secretarial and presidential priorities.

The above drain on resources leaves the Secretary of Commerce to rely upon
afew dozen direct support staff, supplemented with detailees and indirect fund-
ing from each of the bureaus to execute the President’s agenda and manage the
diverse functions of the department. This structure empowers career staff in each
bureau and makes it harder to mandate change. As such, it is vitally important
that an incoming Administration fully staff OS with political appointees, send
all existing detailees back to their home bureaus on Day One, and replace those
detailees with trusted and knowledgeable career staff on an as-needed basis.
Department of Commerce leadership should also fight to restore direct fund-
ing and additional political appointee positions to OS and its constituent parts
involved in implementing and communicating the Commerce Secretary’s and
President’s policy priorities.

Administration, Budget, and Appropriations. Recent practice has been for
career staff to serve as gatekeepers between department leadership and external
budget and appropriations partners at the OMB and on Capitol Hill. By serving
not just as a central point of contact but as the sole staff-level communicators of
departmental priorities, these career officials can, have, and will slow down—and
even stop—changes in policy, even at the line-office level.

Although the following is true at all agencies, it is particularly important at the
Department of Commerce that political leadership be immediately installed at the
Office of the Chief Financial Officer (CFO) and Assistant Secretary for Administra-
tion (ASA), and that political appointees receive a mandate to communicate with
external partners alongside career staff at every stage of the budget and appropri-
ations process. Political appointees must also monitor internal CFO operations
down to the operating division level to ensure that funds are not being diverted
to programs that do not align with Administration priorities, as has regularly hap-
pened in years past.

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Mandate for Leadership: The Conservative Promise

Advisory Committees. Due to the nature of the Department of Commerce’s
portfolio, many of its advisory committees are populated by activists from organi-
zations openly hostile to conservative principles who use the committees to impede
conservative policy. Upon entering office, all such committees should be reviewed
regarding whether they are required by statute and abolished if they are not. Mem-
bership of the remaining committees should be reconstituted to ensure they are
sources of genuine expert advice and productive contributions to the policy-making
process. Federal Advisory Committee Act (FACA) compliance and awareness of
any ways the committees have been written into regulations should be considered.

INTERNATIONAL TRADE ADMINISTRATION

The International Trade Administration is centrally placed to craft and
implement U.S. trade policy. Core to ITA’s mission is the expansion of trade and
investment and the fostering of job creation, innovation, and economic growth,
while also providing research and analysis that support USTR’s trade negotiations.
ITA carries out this mission on behalf of American workers, ranchers, and families.

As discussed elsewhere, historically, conservatives have argued that many fed-
eral government trade and investment-oriented functions amount to corporate
welfare or protectionism. There is a growing counterargument within the conser-
vative movement contending that, in a world in which managed trade is the norm
rather than the exception, and in which authoritarian governments, especially
China, continually seek to undermine U.S. interests, the U.S. cannot unilaterally
disarm. To do so would harm the cause of free trade in the long term, and, in any
event, Congress is not likely to drastically change the composition or authoriza-
tion of the ITA. Thus, a policy and management agenda that serves conservative
priorities is crucial.

In a conservative Administration, the ITA should operate with the follow-
ing priorities:

e Counter the malign influence of China and other U.S. adversaries;

e Enforce agreements vigorously and defend against trade violations;

e Secure access to critical supply chains and technology; and

e Enable the private sector to drive innovation and remain globally competitive.
It is important to note that a deeply entrenched set of career Senior Executive

Service officials have managed the ITA for over a decade. While most are truly

non-partisan civil servants, some are not. Political leadership must manage accord-
ingly. Strong political leadership is needed in ITA’s policymaking positions from

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2025 Presidential Transition Project

Day One to ensure the bureau is fully implementing Administration policy. An
incoming Administration should ensure that Assistant Secretary and Deputy Assis-
tant Secretary positions are staffed by appointees as quickly as possible.

Enforcement and Compliance. Strong enforcement of trade agreements is
an indispensable function of the ITA carried out by Enforcement & Compliance
(E&C). Free and fair trade is impossible without energetic enforcement of exist-
ing agreements and without strong defense against dumping and illegal subsidies.

Many free trade advocates consider antidumping and countervailing duty laws
(AD/CVD) to be protectionist and thus antithetical to the conservative free market
position. In their view, AD/CVD laws are overused, abused by certain industries,
and harmful to American economic competitiveness by increasing costs to down-
stream industries.

Other conservatives maintain that AD/CVD tariffs are not conventional tariffs,
but rather corrective actions meant to address anti-free market activities by other
governments—a scalpel, not ahammer. In the short term, this may mean higher
costs for U.S. businesses and consumers on a limited number of products from cer-
tain offending countries, but those higher prices correct existing price distortions
in the marketplace and ultimately ensure the healthy operation of market forces
in the long term and a level playing field for U.S. manufacturers.

Whatever the case, improvements to the current system must be made to both
protect U.S. consumers and companies from improperly applied duties and defend
against trade-distorting actions by other governments. Procedures governing the
day-to-day administration of proceedings, as well as policies driving critical deci-
sions in proceedings, require a fresh look. Ultimately, E&C’s mandate is to conduct
a rigorous but also fair, objective, and balanced review of the record in each pro-
ceeding and to make decisions without bias.

It is exceedingly unlikely that Congress would abolish or limit the activity of
E&C. Therefore, the proposals below are made under the assumption that an
incoming Administration will operate E&C within its current legal, institutional,
and political confines and set a path forward to wield E&C’s considerable power to
achieve the goals of a conservative Administration. These proposals can be broken
into three categories: process, policy, and addressing China.

Process

e Re-establish and expand suspended in-person pandemic-related
verifications, particularly regarding the People’s Republic of China. Ensure
that verifications are rigorous.

e Implement advanced analytics and artificial intelligence to identify

opportunities for self-initiation, detect circumvention, and prevent bad
actors from gaming the system.

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Accelerate front-end work on reviews as opposed to constantly pushing
against statutory deadlines.

Work with Customs and Border Protection (CBP) and other relevant
agencies to address circumvention and duty evasion, and promote policies
that encourage full duty collection to ensure the integrity of AD/CVD and
circumvention orders.

Work with CBP, the Department of Justice, the Department of Treasury,
and other relevant agencies to aggressively pursue importers of record and
other beneficiaries for unpaid duties, and consider policy changes to reduce
uncollected duties in the future.

Work, pursuant to the above, with interagency partners in AD/CVD cases to
either require foreign importers of record ORs) to make cash deposits far in
excess of established duty rates at the time of entry of AD/CVD merchandise,
require IORs to register sufficient U.S. assets to ensure timely payment of

duties, or otherwise prohibit IORs from importing AD/CVD merchandise.

Conduct a regulatory capture audit and put guardrails in place to address
improper exercise of bureaucratic prerogative.

Policy

Ensure senior policy and decision-making positions are always held by
political appointees.

Reverse the practice of giving the benefit of the doubt to foreign companies
versus U.S. companies in AD/CVD proceedings.

Establish a policy for addressing companies that invest heavily in the U.S.
and thus have large import volumes, exposing them to AD/CVD petitions.

Establish an effective, fair, and objective process for self-initiation of AD/
CVD proceedings when industry lacks the resources or ability to act.

Addressing China
Revive the China-specific non-market economy unit.

Provide transparency in the surrogate country list development process.

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e Develop anew methodology to determine normal values in Chinese anti-
dumping cases because—given China’s size, economic might, and state
intervention in the economy—there is no comparable surrogate country to
use as a proxy for production costs.

In addition to these changes, continued support for steel and aluminum market
analysis and import monitoring remains crucial to the U.S. defense industrial base
and the health of global manufacturing. Without these functions, it is difficult to
address massive subsidization, overcapacity, and dumping by China.

Industry and Analysis. Industry and Analysis (I&A) consists of a team of econ-
omists and industry experts that provides important analysis to partners across
the government, including the White House and USTR, as well as the public.

As the Department of Commerce’s Committee on Foreign Investments in the
United States (CFIUS) lead, I&A performs crucial work to ensure that the proper
economic impact/supply chain analysis is brought to national security risk assess-
ments. This analysis is needed for CFIUS to be an effective tool in preventing China
and other adversaries from exploiting the U.S.’s open investment climate.

I&A also provides impact assessments and economic modeling for policy
options under Administration consideration; plays a critical role in identifying
trade barriers and providing industry-specific expertise for USTR during free trade
agreement (FTA) negotiations; and does indispensable work ensuring cross-bor-
der data flows, particularly with Europe, remain open and relatively unrestricted.

However, outside of these functions, implementation of I&A’s mission as an
intellectual engine for U.S. trade and investment policy can often lack energy and
focus. For instance, the Top Market Reports that represent a large volume of I&A
work do not serve a specific strategic function and could be better replaced by
industry competitiveness assessments in critical sectors of the economy.

Strong and capable leadership is needed in I&A to ensure Administration pri-
orities permeate the organization and that staff support Administration priorities.
I&A produces a mandatory report to Congress regarding the Miscellaneous Tariff
Bill, which focuses solely on U.S. capacity in the goods being considered for tariff
exclusions and does not include highly relevant information on capacity among
FTA partners and close allies. The resulting final report has thus been used to lobby
for tariff reductions on thousands of imports from China without concern for any
other factors. This lack of priority given to FTA partners is troubling.

Going forward, I&A should be permanently restructured to perform supply-chain
analysis on an ongoing basis for the U.S. government, identifying potential vulner-
abilities like those exposed by the pandemic and resulting shortages in everything
from semiconductors to baby formula. Furthermore, permanent standing teams
should be established and staffed by properly aligned political appointees and trusted
career staff to analyze and spur action on the following priority policy issues:

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Strategic decoupling from China;

Defense industrial base strength;

Critical supply chains (e.g., pharmaceuticals, medical devices, food); and

e Emerging technologies (e.g., rare earth minerals, semiconductors, batteries,
artificial intelligence, quantum computing).

Global Markets and the U.S. and Foreign Commercial Service. For more
than a decade, strategic planning at Global Markets (GM) and the U.S. and For-
eign Commercial Service (CS) has been consistently undermined by increased
costs associated with overseas staff and flat or reduced budgets. The Trump
Administration introduced crucial, long-overdue business practices such as the
implementation of software to manage and track workflow, but a further strategic
overhaul of resource allocation is needed to set GM and the CS ona firm footing.

Currently, CS manages staff spread over 106 domestic offices in 77 countries
around the world. Abroad, several “partner posts” utilize interagency staff and
regionally located CS officials to offer services without a permanent physical
in-country CS presence. Given the rapidly rising costs imposed by the State Depart-
ment on CS posts overseas, a drastic expansion of this model is likely needed.

CS resources should be distributed according to the following set of priorities:

e Value in countering the malign influence of adversaries, particularly China;
e Value in fostering U.S. innovation;
e Value in maintaining access to critical supply chains and technology;

e Difficulty for U.S. companies in gaining market access without CS
involvement; and

e Potential untapped export market size and likelihood of expansion.

Ultimately, difficult decisions must be made about the value of CS posts and
whether individual posts can be justified given current resources and the above
criteria. If the State Department deems the diplomatic value of a permanent
in-country CS post to be vital to the national interest, then State should bear more
of the cost of maintaining that post.

Global Markets should also consolidate and elevate the Advocacy Center and
SelectUSA as relatively low-cost tools to drive large-scale export transactions

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and foreign direct investment (FDI. SelectUSA is a low-cost and effective tool in
attracting FDI to the U.S. and to re-shore manufacturing and research and devel-
opment. In a world in which corruption is rampant, these are among the most
effective tools in leveling the playing field for U.S. communities and companies
seeking to engage with governments and potential overseas investors.

Given the value placed on senior-level engagement by many governments and
companies, this consolidated Office of Trade and Investment Advocacy should be
headed by a Deputy Assistant Secretary. The new office should also seek congres-
sional authorization to utilize its FDI-promotion tools to encourage reshoring by
U.S. businesses.

BUREAU OF INDUSTRY AND SECURITY

During the past two decades, technology transfer from America and its allies has
helped accelerate adversaries’ technological and weapons capabilities. This tech-
nology transfer on a massive scale has occurred because of adversaries’ exploitation
of the U.S.’s open economy and education system through both commercial trans-
actions and university and government research programs. Examples include the
People’s Republic of China’s dramatic leaps forward in semiconductor design and
fabrication, battery energy storage, nuclear weapons capabilities, artificial intel-
ligence, space and aerospace engineering, and hypersonic weapons deployment.

At the same time, the U.S. has systematically failed to protect critical assets.
Rather than promulgate policies to better prevent technology transfer, the U.S.
government has either ignored the problem or, worse, from 2008 through 2016
instituted a government-wide “Export Control Reform” process to loosen the
Export Administration Regulations (EAR) governing exports of dual-use items
to facilitate technology transfer to adversaries, either directly or indirectly through
third-country transfers.

Those reforms still present in the Department of Commerce’s EAR must be
reversed. The United States needs stronger rules to protect technology transfer
to adversaries while promoting technology integration and interoperability with
allies. Further, U.S. export control regulations should be utilized to prevent theft
of personally identifiable information and to encourage U.S. companies to shift
production out of China and further diversify their supply chains to better advance
US. national security interests.

For all the below recommendations, BIS needs to move unilaterally while it
works with allies to implement complementary export control policies. Waiting
to act until allies are ready to move in lockstep is not an option while America’s
national security is at risk.

Emerging and Foundational Technologies. The Export Control Reform Act
of 2018 (ECRA) gave BIS permanent statutory authority to regulate exports of
dual-use items (goods, software, and technology). ECRA also mandated that BIS

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regulate exports of emerging and foundational technologies. Although the scope
of such technologies is vast, to date BIS has only controlled just over 40 of these
technologies. This does not meet the clear statutory intent of Congress that ECRA
be leveraged to ensure that the United States maintains a technological advantage
in technologies bearing upon national security interests.

Currently, BIS self-identifies technologies that merit control under the EAR with
minimal input from other federal agencies. This mechanism should be improved.
BIS should create an open, transparent rulemaking process by which any industry
participant, private entity, or branch of the government may, at any time, submit
nominations for emerging /foundational technologies for control. Then, on a quarterly
basis, BIS should make public such recommendations (while holding the identity
of the submitter confidential) for public input, followed by an explanation about its
ultimate decision to control or not control the items, its reasons, the level of controls
applied (stringent or permissive), and the relevant Export Control Classification
Number (ECCN) under the Commerce Control List. Commerce should also institute a
mechanism whereby its decisions can be challenged, including ona confidential basis.

Licensing Procedures: Adjudication and Transparency. Currently, if the
Departments of Defense, State, Commerce, and Energy disagree on an export
license decision, the disagreement may be escalated to the Operating Commit-
tee—and subsequently to the Advisory Committee on Export Policy led by BIS’s
Assistant Secretary for Export Administration. The Assistant Secretary does not
need to lead the dispute resolution, and this process should be revised by giving lead
authority to BIS’s Under Secretary, who is better able to account for diverging views.

Moreover, BIS’s authority to overrule other agency votes should be changed.
Each agency should have one equal vote and, if a licensing dispute remains unre-
solved, the final decision should be elevated to the National Security Advisor and
the Secretaries of Defense, State, Commerce, and Energy.

Additionally, to improve congressional oversight of BIS’s license adjudication
process, BIS should provide specific congressional committees with data from the
Automated Export System on a quarterly basis. Electronic files should contain
U.S. exporter by name; product description (e.g., harmonized system code and
ECCN/U. S. Munitions List designation); end user and destination country; and
when a license was required, whether the license was granted or denied. BIS cur-
rently denies just 1.2 percent of export licenses. These data reporting requirements
can help Congress better determine whether BIS is adequately protecting national
security through appropriate use of export controls or whether additional direction
from Congress is required.

Improve End-Use Checks. The integrity of the export control system may be
validated only through adequate end-use checks. BIS must deny export licenses
to countries that do not permit adequate end-use checks (e.g., China/Russia) by
U.S. authorities. BIS should also strengthen the forensic audit capabilities of its

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Export Enforcement officers through improved and frequent training so they are
able to detect export-control violations.

EAR Revisions. The U.S. Government needs a new export control moderniza-
tion effort to tighten the EAR policies governing licenses to countries of concern,
including China and Russia (specifically, revise and/or reverse the 2008 through
2016 policies).

When authoritarian governments explain what they plan to do, believe them unless
hard evidence demonstrates otherwise. Case in point: China’s and Russia’s stated
civil-military fusion policies demand central government command-and-control
style systems in which every private entity serves the interests of the state and is
forced to provide technology, services, capacity, and data to the central govern-
ment and the military. Through this structure, commercial activities are routinely
weaponized by authoritarian regimes that repeatedly identify the U.S. as an enemy.
Accordingly, U.S. export control policies must be updated to reflect these realities
and the associated threats to national security.

Key priorities for EAR modernization for countries of concern should be:

Eliminating the “specially designed” licensing loophole;

e Redesignating China and Russia to more highly prohibitive export licensing
groups (country groups D or E);

e Eliminating license exceptions;
e Broadening foreign direct product rules;

e Reducing the de minimis threshold from 25 percent to 10 percent—or O
percent for critical technologies;

e Tightening the deemed export rules to prevent technology transfer to
foreign nationals from countries of concern;

e Tightening the definition of “fundamental research” to address exploitation
of the open U.S. university system by authoritarian governments through

funding, students and researchers, and recruitment;

e Eliminating license exceptions for sharing technology with controlled
entities/countries through standards-setting “activities” and bodies; and

e Improving regulations regarding published information for
technology transfers.

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The next few years will prove or disprove the assertion that the U.S. stands on
the precipice of a Cold War with China. Many believe that a Cold War has already
begun; if so, then strategic decoupling from China is necessary and, fundamentally,
any exports of goods, software, and technology to countries of concern, whether
directly or indirectly, should be prohibited or controlled in the absence of good
cause (e.g., humanitarian and medical aid, food aid).

Entity List and Sanctions. There are currently just over 500 Chinese and over
500 Russian companies on the Department of Commerce’s Entity List, which reg-
ulates exports of controlled and uncontrolled items to designated entities. Given
China’s Civil-Military Fusion Strategy and Russia’s massive war efforts facili-
tated by abroad range of the Russian economy, BIS must add more entities to the
Entity List and apply a license review “policy of denial” that prohibits exports to
these entities.

Entity List parties that violate export controls should be placed on the BIS
Denied Persons List (and thereby lose export privileges) and, if the violations are
significant enough, they should also be sanctioned by the Department of Treasury.

Data Transfer and Apps Used for Surveillance. Department of Commerce
leadership should work across government agencies to address privacy and data
concerns arising out of “big tech” from national security and export control per-
spectives. In particular, they should draft and implement an executive order (EO)
based on the International Emergency Economic Powers Act, which expands export
control authority beyond ECRA’s scope (goods, software, technology) to regulate and
restrict exports of U.S. persons’ data to countries of concern. The EO should establish
a framework for the types of personal data subject to export controls and licensing
policy by country, and the BIS should implement the EO through regulations.

BIS should additionally designate app providers (such as WeChat and
ByteDance/TikTok) known for undermining U.S. national security through data
collection, surveillance, and influence operations, to the Entity List. This listing
would prevent app users from program updates, which would quickly make these
apps non-operational in the United States.

NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION

Break Up NOAA. The single biggest Department of Commerce agency outside
of decennial census years is the National Oceanic and Atmospheric Administration,
which houses the National Weather Service, National Marine Fisheries Service,
and other components. NOAA garners $6.5 billion of the department’s $12 billion
annual operational budget and accounts for more than half of the department’s
personnel in non-decadal Census years (2021 figures).

NOAA consists of six main offices:

e The National Weather Service (NWS);

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e The National Ocean Service (NOS);
e The Oceanic and Atmospheric Research (OAR);
e The National Environmental Satellite, Data and Information Service (NESDIS);

e The National Marine Fisheries Service (NMFS); and

The Office of Marine and Aviation Operations and NOAA Corps.

Together, these form a colossal operation that has become one of the main
drivers of the climate change alarm industry and, as such, is harmful to future
USS. prosperity. This industry’s mission emphasis on prediction and management
seems designed around the fatal conceit of planning for the unplannable. That is
not to say NOAA is useless, but its current organization corrupts its useful func-
tions. It should be broken up and downsized.

NOAA today boasts that it is a provider of environmental information services,
a provider of environmental stewardship services, and a leader in applied scientific
research. Each of these functions could be provided commercially, likely at lower
cost and higher quality.

Focus the NWS on Commercial Operations. Each day, Americans rely on
weather forecasts and warnings provided by local radio stations and colleges that
are produced not by the NWS, but by private companies such as AccuWeather.
Studies have found that the forecasts and warnings provided by the private com-
panies are more reliable than those provided by the NWS.?

The NWS provides data the private companies use and should focus on its
data-gathering services. Because private companies rely on these data, the NWS
should fully commercialize its forecasting operations.

NOAA does not currently utilize commercial partnerships as some other
agencies do. Commercialization of weather technologies should be prioritized
to ensure that taxpayer dollars are invested in the most cost-efficient technol-
ogies for high quality research and weather data. Investing in different sizes of
commercial partners will increase competition while ensuring that the govern-
ment solutions provided by each contract is personalized to the needs of NOAA’s
weather programs.

The NWS should be a candidate to become a Performance-Based Organization
to better enforce organizational focus on core functions such as efficient delivery
of accurate, timely, and unbiased data to the public and to the private sector.®

Review the Work of the National Hurricane Center and the National
Environmental Satellite Service. The National Hurricane Center and National
Environmental Satellite Service data centers provide important public safety and

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business functions as well as academic functions, and are used by forecasting agen-
cies and scientists internationally. Data continuity is an important issue in climate

science. Data collected by the department should be presented neutrally, without

adjustments intended to support any one side in the climate debate.

Transfer NOS Survey Functions to the U.S. Coast Guard and the U.S. Geo-
logical Survey. Survey operations have historically accounted for almost half the
NOS budget. These functions could be transferred to the U.S. Coast Guard and U.S.
Geological Survey to increase efficiency. NOS’ expansion of the National Marine
Sanctuaries System should also be reviewed, as discussed below.

Streamline NMFS. Overlap exists between the National Marine Fisheries
Service and the U.S. Fish and Wildlife Service. Overly simplified, the NMFS handles
saltwater species while the Fish and Wildlife Service focuses on fresh water. The
goals of these two agencies should be streamlined.

Harmonize the Magnuson-Stevens Act with the National Marine Sanctuaries

Act. Under the auspices of NOS, marine sanctuaries (including no-fishing zones)
are being established country-wide, often conflicting with the goals of the Magnu-
son-Stevens Act fisheries management authorities of NOAA Fisheries, regional
fishery management councils, and relevant states.

Withdraw the 30x30 Executive Order and Associated America the Beautiful Ini-
tiative. The 30x30 Executive Order and the American the Beautiful Initiative are
being used to advance an agenda to close vast areas of the ocean to commercial
activities, including fishing, while rapidly advancing offshore wind energy devel-
opment to the detriment of fisheries and other existing ocean-based industries.

Modify Regulations Implementing the Marine Mammal Protection Act and the
Endangered Species Act. These acts are currently being abused at a cost to fisheries
and Native American subsistence activities around the U.S.

Allow a NEPA Exemption for Fisheries Actions. All the requirements for robust
analysis of the biological, economic, and social impacts of proposed regulatory
action in fisheries are contained with the Magnuson-Stevens Act, the guiding Act
for fisheries. NEPA overlays these requirements with onerous, redundant, and
time-consuming process requirements, which routinely cause unnecessary delays
in the promulgation of timely fisheries management actions. The Department
of Commerce and the Council on Environmental Quality should collaborate to
reduce this redundancy.

Downsize the Office of Oceanic and Atmospheric Research. OAR provides
theoretical science, as opposed to the applied science of the National Hurricane
Center. OAR is, however, the source of much of NOAA’s climate alarmism. The
preponderance of its climate-change research should be disbanded. OAR is a large
network of research laboratories, an undersea research center, and several joint
research institutes with universities. These operations should be reviewed with
an aim of consolidation and reduction of bloat.

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Break Up the Office of Marine and Aviation Operations and Reassign
Its Assets to Other Agencies During This Process. The Office of Marine and
Aviation Operations, which provides the ships and planes used by NOAA agencies,
should be broken up and its assets reassigned to the General Services Administra-
tion or to other agencies.

Use Small Innovation Prizes and Competitions to Encourage High- Qual-
ity Research. Lowering the barriers of entry for startups and small businesses will
also provide greater innovation without excessive increases in spending. Reaching
beyond traditional partnerships for innovative engagement tools that encourage
entrepreneurial innovation will allow NOAA’s research programs to adapt more
quickly to the world’s changing needs. Multiple competitions should take place in
cities to attract a variety of innovators and investors to propel innovation forward
in a way that benefits the needs of NOAA.

Ensure Appointees Agree with Administration Aims. Scientific agencies
like NOAA are vulnerable to obstructionism of an Administration’s aims if political
appointees are not wholly in sync with Administration policy. Particular attention
must be paid to appointments in this area.

Elevate the Office of Space Commerce. The Office of Space Commerce is
the executive branch advocate on behalf of the U.S. commercial space industry.
This office should be the vehicle for a new Administration to set a robust and
unified whole-of-government commercial space policy that cements U.S. lead-
ership in one of the most crucial industries of the future. The Office’s current
mission has been lost owing to its position within NESDIS, which sees no role
for itself in advancing the industry and the space economy, including ensuring
global competitiveness. OSC is, by law, the Department of Commerce’s lead on
space policy and must therefore link directly to all the bureaus and other orga-
nizations within the department. The Office needs to be returned to OS, within
which it existed for the first two decades of its existence. From OS, the Office
could serve as a coordinating entity for the whole-of-government commercial
space policy desperately needed to secure America’s place as the global leader
in commercial space operations.

There presently exists no unified U.S. government policy on commercial space
operations, with the Federal Communications Commission largely responsible
for establishing space policy by default through its regulation of radio spectrum
licenses. Now that routine space operations are commercially viable, it is critical
that a new Administration establish reasonable government policies that ensure
the U.S. will continue to be the flag of choice for commercial space activities. The
President should, by executive order, direct the Office of Space Commerce, working
with the National Space Council, to establish a whole-of-government policy for
licensing and oversight of commercial space operations.

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BUREAU OF ECONOMIC ANALYSIS AND THE OFFICE OF
THE UNDERSECRETARY FOR ECONOMIC AFFAIRS

The Office of the Under Secretary for Economic Affairs is charged with conducting
economic analysis, promoting business and commerce, guiding data-driven deci-
sion-making and evidence-building activities, and increasing access to government
data while ensuring privacy and confidentiality. The office coordinates economic
analysis needs across the Department of Commerce, leads the department’s initia-
tives and programs related to data, data policy, and data management, and provides
policy direction and oversight for the Bureau of Economic Analysis (BEA) and the
Census Bureau. In addition to the Under Secretary for Economic Affairs, key staff
roles in the office include the Chief Economist and the Chief Data Officer.

The office could be an effective tool for anew Administration if it focuses its
efforts on supporting the Department’s mission to ensure the conditions for eco-
nomic growth and opportunity—conducting economic analysis and producing
data for key departmental policy initiatives, as well as working across agencies to
support broader Administration goals. As the office charged with providing policy
direction and oversight for BEA and the Census Bureau, new leadership should
take an early and active role within both bureaus.

BEA is a federal statistical agency under the Office of the Undersecretary for
Economic Affairs. BEA’s mission is to promote a better understanding of the U.S.
economy by providing timely, relevant, and accurate economic accounts data in
an objective manner. BEA is responsible for producing economic indicators such
as the U.S. gross domestic product (GDP), state and local GDP estimates, foreign
trade and investment statistics, industry data, and consumer spending numbers.

The data produced by BEA are used by government and business decision-mak-
ers to understand the state of the nation’s economy. A new Administration should
ensure that BEA conducts its statistical analysis in a consistent and objective
manner, with the Undersecretary for Economic Affairs taking a strong interest in
BEA’s operations and data products.

Anew Administration should also study the feasibility of merging all statistical
agencies (Census Bureau, Bureau of Economic Analysis, and the Department of
Labor’s Bureau of Labor Statistics, etc.) under one bureau to increase efficiency
and better coordinate cross-departmental issues.

CENSUS BUREAU

The Census Bureau’s core mission is to execute the executive branch’s constitu-
tional mandate to conduct a census every 10 years, but its activities have steadily
grown and shifted to include the economic census, American Communities Survey,
and further functions outside of its core mission.

An incoming conservative Administration should focus on three areas: day-to-
day management, the decennial census, and other programs. Each of these will

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need to be addressed at every stage of the transition and policy implementation
process and will require that both committed political appointees and like-minded
career employees are in immediately put in place to execute a conservative agenda.
These will need to be placed both in the Census Bureau and in key department-level
managerial positions, such as those in the CFO/ASA’s office.

Day-to-Day Management

e Command and control. Strong political leadership is needed to increase
efficiency and align the Census Bureau’s mission with conservative
principles. Personnel is key to ensuring that anew Administration can guide
preparations for the 2030 census and oversee the continued operation
of the Bureau’s many surveys. To move bureaucracy on key priorities,
appointed staff should be in place at the Bureau as early as feasible after
anew President takes office. This will require the Office of Personnel
Management to allocate additional political appointee positions to the
Census Bureau.

e Financial management, information technology, and human
resources. The new Administration must immediately conduct a review
to identify ways to better control costs and reverse recent failures of
investments intended to upgrade the financial management, information
technology, and human resources systems of the Census Bureau.

e Leveraging technology. The Census Bureau should focus on continuing
to incorporate technology into its day-to-day operations, as well as the
execution of its surveys, to reduce costs and provide more accurate and
timely data to the American public.

e ©6Prioritizing cybersecurity and protection of confidential information.
Because much of the data collected by the Census Bureau include personal
and confidential information, a focus on protecting data and implementing
proper data protocols is necessary to ensure compliance with the legal
requirements of Title 13.

Decennial Census

e ©6Fully vet existing planning and budgeting from Day One. Planning
and budgets for the 2030 decennial census will be finalized in fall 2025,
including many decisions on how to use, develop, and administer the count.
An incoming Administration should immediately audit the lifecycle cost
estimate (LCCE) for the 2030 census and conduct a new LCCE if necessary.
This will ensure that budget requests are accurate and up-to-date and

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allow the new Administration to understand the decennial process in
greater detail.

Remove duplicative functions to increase efficiency. As part of the
above review, ensure the decennial operational plan eliminates current
duplication among ongoing census operations (annual surveys, etc.) and
decennial operations in information technology, human resources, etc. This
overlap has been estimated to waste billions of dollars in the years leading
up to each decennial census.

Review the partnership program. This program, designed to promote
responsiveness to the census by employing trusted voices in various
communities, deserves careful scrutiny. Anew Administration should work
to actively engage with conservative groups and voices to promote response
to the decennial census. Promoting response to the decennial census will
ensure that the most accurate counts are conducted, leading to a more
accurate apportionment of congressional representation and allocation

of federal funds. In 2020, lack of conservative participation was one factor
in an undercount in some areas of the country, affecting representation of
certain states.

Add a citizenship question. Despite finding that the Trump
Administration’s addition of the citizenship question to the 2020 decennial
census violated the Administrative Procedures Act, the Supreme Court
held that the Secretary of Commerce does have broad authority to adda
citizenship question to the decennial census. Any successful conservative
Administration must include a citizenship question in the census. Asking a
citizenship question is considered best practice even by the United Nations.
By law, the Census Bureau must deliver the decennial census subjects/
topics to Congress three years before Census Day (in this case, by April 1,
2027). Questions must be presented to Congress two years before Census
Day (April 1, 2028).

Review forthcoming changes to race and ethnicity questions. The
current Administration has announced its intent to change data collection
methods regarding race and ethnicity by combining the two questions

on the decennial questionnaire and increasing the number of available
options. A new conservative Administration should take control of this
process and thoroughly review any changes. There are concerns among
conservatives that the data under Biden Administration proposals could be
skewed to bolster progressive political agendas. Government data should be

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unbiased and trusted—and an incoming conservative Administration should
ensure that is the case. This work must be coordinated with the Office of
Management and Budget, which governs federal data collection standards
via its statistical directives.

Reevaluate all decennial census questions. Determine how best to
optimize use of the decennial census to determine whether current or
additional questions provide added value in coordination with other
departments that utilize the information. Overly intrusive questions or less
crucial data should either be moved to another survey or removed from
Census programs entirely.

Other Census Programs

The American Communities Survey. After the decennial census, the next
biggest statistical survey conducted by the Census Bureau is the American
Communities Survey (ACS). As with the decennial census, each question
should be carefully reviewed to ensure the data are useful and that the
questions are not overly intrusive. There should be collaboration with other
departments that use the information collected on these surveys (e.g., the
Departments of Labor, Health and Human Services, Homeland Security,
etc.) to determine how to optimize the use and collection of particular
information.

The Economic Census. This is the official five-year measurement of
American business and the economy. The first Economic Census in a new
Administration will take place in 2027 and have a major effect on federal
spending and policy determinations. This survey collects business data that
are a key input for ongoing government statistics such as BEA’s GDP reports.
As with the decennial census and ACS, it should be carefully examined

to ensure the Economic Census is not overly intrusive. Additionally, the
Census Bureau should work with other federal agencies to determine

when data collection can be supplemented by industry and other federal
business indicators.

Pulse surveys. During the government’s early response to the COVID-19
pandemic, the Census Bureau began experimental pulse surveys. These
were designed to obtain data closer to real-time than typical census surveys.
These data could be a useful tool to the Department of Commerce and

other partners across government and provide a model for improving data
collection techniques or reducing the overall footprint of the Census Bureau.

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e Supplemental Poverty Measure. The Census Bureau should review the
Supplemental Poverty Measure (SPM) to consider whether it provides an
accurate measure for use by the Council of Economic Advisers and others.
The findings from this review should also be taken into consideration when
constructing the Current Survey and other supplemental surveys, so that
the SPM can be better tracked on a trend basis and support better policy
decisions over time. This information would be particularly helpful in
determining how to combat homelessness in conjunction with Department
of Health and Human Services programs.

e Abolish the National Advisory Committee and reevaluate all other
committees. The Census Bureau National Advisory Committee on Racial,
Ethnic, and Other Populations (NAC) was established by the Obama
Administration in 2012 and rechartered by the Biden Administration in
2022. The committee is a hotbed for left-wing activists intent upon injecting
racial and social-justice theory into the governing philosophy of the Census
Bureau. The NAC should immediately be abolished by the incoming
Administration. The NAC charter gives the Secretary of Commerce the
authority to terminate the committee. Since the Secretary of Commerce
established the NAC in 2012 under the FACA, the Secretary is authorized
to terminate the NAC. The new Administration should also reevaluate
and potentially abolish all non-statutory standing committees within the
Census Bureau, including the Census Scientific Advisory Committee.

ECONOMIC DEVELOPMENT ADMINISTRATION

The Economic Development Administration (EDA) is charged with investing in
local communities to encourage and enable growth and innovation in the private
sector, with particular focus on distressed or underserved areas. Over time, it has
also served as a distribution mechanism for emergency relief funds (e.g., Hurricane
Maria and COVID-19).

In the Trump Administration, the EDA served an important role for the CARES
Act. It successfully disbursed approximately $1.5 billion in funding beginning in
May 2020 and throughout the COVID-19 pandemic. However, this task revealed
EDA’s shortcomings. Ona capability level, EDA lacked the technical and financial
systems and skills to disburse these funds in a compliant manner and required
external contracts for advisory support to hire the personnel needed to accom-
plish its goals.

Historically, EDA was a small bureau with an annual budget for $350 million
in Public Works grants annually. EDA’s decision-making is decentralized to its
six regional offices, which delayed the release of CARES Act funding by months.
But more broadly, EDA is an impediment to coordinated campaigns that advance

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Administration priorities. Rather than implementing the new Department Organi-
zation Orders required to put conservative governance in place, it would be more
efficient to abolish EDA and reallocate its funding to other overlapping federal
grant programs.

If that proves unachievable, as has historically been the case due to political
considerations in Congress, EDA would benefit from:

e Consolidation of decision-making to the Assistant Secretary’s office to
better align funding with conservative political purposes. For example,
funding initiatives in rural communities destroyed by the Biden
Administration’s attack on domestic energy production would be well
within the scope of EDA’s mission.

e Leveraging of the direct hire authorities established in the Trump
Administration for special initiatives or disaster/recovery funding. Leaving
these programs to entrenched career employees with their ties to the
regional offices will do little to advance the conservative agenda.

e Continuation of disaster funding with better coordinated capabilities and
decision-making in accordance with the points above (e.g., maintaining
contract vehicles for staff augmentation as needed).

e Building on the initial success of Opportunity Zones, which incentivized
over $75 billion in private sector investment in distressed communities by
the end of 2020 with little up-front cost to the taxpayer.

MINORITY BUSINESS DEVELOPMENT AGENCY

The Minority Business Development Agency (MBDA) is the only federal agency
solely dedicated to the growth and competitiveness of minority-owned businesses.
The Minority Business Development Act of 2021 was signed into law as part of the
Bipartisan Infrastructure Investment and Jobs Act. This legislation made MBDAa
permanent federal agency, created a Senate-confirmed Under Secretary position,
and expanded programs and outreach. The Act:

e Authorizes the creation of regional offices and rural business centers,
increasing the number and scope of existing grant programs supporting

MBDA business centers;

e Mandates grants to minority serving institutions to cultivate future
generations of minority entrepreneurs; and

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e Establishes a Minority Business Advisory Council to advise the Under
Secretary on supporting minority-owned businesses.

MBDA was established in 1969 by President Richard Nixon under Executive
Order 11458% as the Office of Minority Business Enterprise and the Advisory
Council for Minority Business Enterprise. Its purpose was to strengthen and
preserve minority business enterprises (MBEs) and to coordinate among
MBEs and other groups such as state and local governments and trade asso-
ciations. For over 50 years, the MBDA operated under executive order without
clear congressional authorization, but was regularly recognized and promoted
by every subsequent president, including Presidents Ronald Reagan and
Donald Trump.’

MBDA has the appearance, on its face, of perpetuating racial bias by focusing
on minority advancement rather than economic need or other criteria. This is
why the Trump Administration proposed eliminating funding for the agency in
2017. Many conservatives ask why the government is funding this activity, which
often amounts to business and management consulting services offered by private
sector entities. Eventually, the Trump Administration changed course and pro-
posed that MBDA continue to exist as a permanently authorized entity focused
on policy rather than offering services. Despite this change, many conservatives
understandably see MBDA as problematic on a philosophical level.

Nonetheless, Congress has spoken recently on this issue and is unlikely to
change its position in the near term. In 2017, MBEs represented one-third of all
U.S.-owned businesses, with almost 9 million employees, generating $1.7 trillion
for the U.S. economy.° As such, a conservative Administration is best served by
approaching MBDA as a tool to be leveraged in the fight to deliver economic oppor-
tunity to all Americans and to produce an economy centered on equal opportunity,
free markets, innovation, and growth.

Conservative leadership at MBDA should focus the organization on:

e Conducting policy analysis on the benefit of free markets, the evils
of socialism and Communism, and the destructive effect of taxes and
regulations on minority businesses;

e Ensuring MBDA business centers operate efficiently with strict oversight of
funding, clear metrics for success, and consequences for poor performance;

e Creating policy-level operational priorities geared toward private sector

action over government action with public-private partnerships serving as a
necessary middle ground;

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e Establishing MBDA as a data and research clearinghouse for minority
business enterprises and policymakers;

e Coordinating amongst Cabinet agencies, state and local government, and
trade associations to best leverage resources and encourage growth and
innovation; and

e Evaluating the harmful effects of unfair trade practices on minority-owned
businesses and their employees.

U.S. PATENT AND TRADEMARK OFFICE

The U.S. Patent and Trademark Office carries out a core constitutional man-
date from Section 8, Article 1: “The Congress shall have Power...[t]o promote the
Progress of Science and useful Arts, by securing for limited Times to Authors
and Inventors the exclusive Right to their respective Writings and Discover-
ies.” Strong intellectual property (IP) protections form the bedrock of American
business and are a key factor in making the U.S. economy the most innovative
in the world. As such, a conservative Administration must constantly work to
strengthen IP rights and combat the incorrect view that strong IP rights some-
how limit innovation.

Political leadership in a new conservative Administration should:

e Support like-minded countries as candidates for leadership in the World
Intellectual Property Organization and build strong relationships with
international partners to strengthen intellectual property rights.

e Re-examine patent eligibility requirements in Section 101 of the Patent Act’
and support internal and/or legislative reforms to enable U.S. leadership
in critical and emerging technologies such as quantum computing, 5G, and
artificial intelligence.

e Take abalanced approach to the Patent Trial and Appeal Board and
prioritize rapid and transparent processing of applications and appeals.

e Work with Administration partners and Congress to find and punish
trademark infringers and counterfeiters.

e Oppose efforts to provide intellectual property waivers for cutting-edge
technologies, including for COVID-19 vaccines and therapeutics, through
the World Trade Organization’s Trade-Related Aspects of Intellectual
Property Rights agreement or any other mechanism.

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NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY

The National Institute of Standards and Technology is charged with promoting
US. innovation and competitiveness by “advancing measurement science, standards,
and technology.”* NIST carries out cutting edge research, helps industry establish
standards and best practices, and is the nation’s foremost authority on measurements.
NIST’s atomic clock, for instance, maintains the official time of the United States.

An incoming Administration should evaluate the federal government’s civilian
research footprint and consolidate those functions while ensuring that any research
conducted with taxpayer dollars serves the national interest in a concrete way in
line with conservative principles. Beyond this, an incoming Administration should:

e =Privatize the Hollings Manufacturing Extension Partnership. The
Hollings Manufacturing Extension Partnership (MEP) establishes and
manages a network of centers focused on advising small- and medium-sized
manufacturers in order to improve processes and thereby strengthen the
US. industrial base. When Congress created the program, MEP centers were
intended to transition to self-sustaining private institutions after using
government funds to begin operations, but the prohibition on long-term
funding was abolished in 1998. MEP’s business advisory services would be
more properly carried out by the private sector. The next Administration
should propose legislation to zero out this $150 million program and fully
privatize existing MEP centers.

e Transfer the Baldridge Performance Excellence Program. This

In 6.

program’s “process” assists companies in improving management and
operations, a function more properly and effectively carried out by the
private sector. This program operates at a cost to taxpayers, despite
thousands of dollars in fees charged to each participating company or entity
and long-term plans to make the program self-sufficient. Maintenance and
operation of the program should be entirely handed over to the Baldridge

Award Foundation to be run by non-government staff via fees.

e Increase value to taxpayers. NIST should reinvigorate the Technology
Transfer and ROI (return on investment) initiatives begun under the Trump
Administration. These initiatives help speed the process of commercializing
science funded by the federal government.

e Reestablish U.S. dominance in international standards. NIST should
explore ways to incentivize broader U.S. participation in standards-setting
bodies and the exclusion of participants from adversaries like China. Standards
are set to facilitate trade in countries that utilize those standards: Countries

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2025 Presidential Transition Project

that do not allow open access to their markets should not be setting the
standards for markets that do allow open access. The incoming Administration
should consider increased government-sponsored participation by private
companies and government employees with relevant expertise.

NATIONAL TELECOMMUNICATIONS AND INFORMATION SERVICE

The independent National Telecommunications and Information Service
(NTIS) is charged with ensuring that federally funded research and data are
accessible to the public. NTIS operates through user fees but is largely obsolete
due to modern usage of the internet by federal agencies and researchers. NTIS’s
functions should be moved to NIST and consolidated with the Tech Transfer and
ROl initiatives.

NATIONAL TELECOMMUNICATIONS AND
INFORMATION ADMINISTRATION

The National Telecommunications and Information Agency (NTIA) is the exec-
utive branch’s statutory lead on telecommunications and information policy. It
focuses on broadband access, spectrum utilization, and other issues that are crucial
to the high-tech economy. For decades, NTIA has suffered from organizational
malaise and will require strong and energetic leadership by political appointees
to implement conservative policies. The next Administration will face the primary
challenge of rapidly deploying 5G without compromising other priorities. Further
recommendations include:

e Support free speech and hold big tech accountable. Immediately
conduct a thorough review of federal policy regarding free speech online
and provide policy solutions to address big tech’s censorship of speech.

e Utilize new tools to eliminate threats to national security. Fully
implement the Trump Administration’s Information and Communications
Technology and Services (ICTS) Executive Order authorities in a way
that ensures long-term success and the legal viability of this new national
security tool.?

e Expand utilization of federal spectrum. Begin short term, temporary
leasing of government allocated spectrum to ensure optimum utilization
while preserving federal agency use rights.

e Support the commercial space industry. Advocate for licensing decisions

at the Federal Communications Commission that continue to enable U.S.
dominance in the commercial space industry.

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Mandate for Leadership: The Conservative Promise

e Defend U.S. interests in international bodies. Strong representation at
the International Telecommunication Union should protect the interests
of both private and government users of spectrum. The U.S. has differing
needs from many other countries, for instance, because of U.S. government
satellites and commercial space industry. NTIA should work with the U.S.
delegation to ensure maximum adoption of the U.S. position.

e Set fresh priorities in broadband grant programs. Reevaluate
broadband grant programs and, when possible, establish Administration
priorities in how each grant is structured. First and foremost, widespread
deployment of infrastructure is needed for 5G adoption in rural and exurban
areas, which will be a key factor in future economic competitiveness for
these under-served communities.

e =©Review FirstNet. Evaluate the performance and long-term value
proposition of FirstNet in view of modern technologies that will render
it obsolete.

CONCLUSION

The above policies, strategies, and tactics will set anew Administration on
firm footing that allows the Department of Commerce to assist the President in
implementing a bold agenda that delivers economic prosperity and strong national
security to the American people. While many of the department’s functions fall
outside the remit of the federal government, its unique authorities in diverse areas
provide critical tools that can and should be brought to bear in implementing a
conservative governing philosophy that keeps Americans safe and provides oppor-
tunity for all.

AUTHOR’S NOTE: This chapter includes invaluable input from over a dozen alumni of the Department of
Commerce and numerous other members of the 2025 Presidential Transition Project. All contributors to this
chapter are listed at the front of this volume, but James Rockas, Nazak Nikakhtar, Louis Heinzer, Robert Burkett,
lain Murray, Michael Gonzalez, David Legates, and Kristen Eichamer deserve special recognition. The author alone
assumes responsibility for the content of this chapter, and no views expressed herein should be attributed to any
other individual.

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ENDNOTES

1. Commerce Department Termination and Government Reorganization Act of 1995, S. Rep. 104-164, 104th
Cong., Ist Sess., October 20, 1995; Angela Antonelli, “Five Good Reasons to Close Down The Department
of Commerce,” Heritage Foundation Backgrounder No. 1181, May 20, 1998, https://www.heritage.org/
budget-and-spending/report/five-good-reasons-close-down-the-department-commerce; and Competitive
Enterprise Institute, “Shrinking Government Bureaucracy: Reorganizing the Executive Branch to Boost
Economic Growth and Freedom,” August 2017, https://cei.org/shrinking-government-bureaucracy/ (accessed
December 16, 2022).
2. ews release, “Latest Study of 120 Million Forecasts Proves AccuWeather Forecasts Are More Accurate,”
AccuWeather, January 14, 2020, https://www.prnewswire.com/news-releases/latest-study-of-120-million-
orecasts-proves-accuweather-forecasts-are-most-accurate-300986848. html (accessed December 16, 2022).
3. — In general, performance-based organizations are established to set forth clear measures of performance,
hold the head of the organization accountable for achieving results, and grant the head of the organization
authority to deviate from government rules if needed to achieve agreed-upon results.
4. — Federal Register, Vol. 34, No. 45 (March 7, 1969), pp. 4935-4938.
5. US. Department of Commerce, Minority Business Development Agency, “The History of the MBDA,” https://
www.mbda.gov/about/history (accessed March 15, 2023).
6. Ashley Winston, The Contribution of Minority Business Enterprises to the U.S. Economy, U.S. Department
of Commerce, Minority Business Development Agency, September 2021, p. 7, https://www.mbda.gov/sites/
default/files/2021-09/The%20Contribution%200f%20MBEs%20to%20US%20Economy%20Report%20%20
-%20September%202021.pdf (accessed March 2, 2023).
7. 35 U.S. Code § 101.
8. — National Institute of Standards and Technology, “About NIST,” https://www.nist.gov/about-nist (accessed
December 16, 2022).
9. Donald J. Trump, “Executive Order on Securing the Information and Communications Technology and Services
Supply Chain” Executive Order No. 13873, May 15, 2019, https://trumpwhitehouse.archives.gov/presidential-
actions/executive-order-securing-information-communications-technology-services-supply-chain/ (accessed
March 20, 2023).

— 689 —

DEPARTMENT OF
THE TREASURY
William L. Walton,
Stephen Moore,

and David R. Burton

INTRODUCTION

The U.S. Treasury Department has a broad regulatory and policy reach. The
next Administration should make major policy changes to: (1) reduce regulatory
impediments to economic growth that reduce living standards and endanger pros-
perity; (2) reduce regulatory compliance costs that increase prices and cost jobs;
(3) promote fiscal responsibility; (4) promote the international competitiveness
of U.S. businesses; and (5) better respect the American people’s due process and
privacy rights.

These goals should be accomplished through: executive action (primar-
ily treasury orders and treasury directives) and departmental reorganization;
rulemakings; promoting constructive policies in Congress; actions in international
organizations; and treaties.

The primary subject matter focus of the incoming Administration’s Treasury
Department should be:

e = Tax policy and tax administration;
e Fiscal responsibility;
e Improved financial regulation;

e Addressing the economic and financial aspects of the geopolitical threat
posed by China and other hostile countries;

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Mandate for Leadership: The Conservative Promise

e Reform of the anti-money laundering and beneficial ownership
reporting systems;

e Reversal of the racist “equity” agenda of the Biden Administration; and

e Reversal of the economically destructive and ineffective climate-related
financial-risk agenda of the Biden Administration.

BIDEN ADMINISTRATION TREASURY DEPARTMENT

The Biden Administration Treasury Department has failed badly in achieving
every one of the agency’s core objectives. The financial affairs of the nation have
seldom been in worse condition, with the national debt expanding by more than $4
trillion in Biden’s first two years in office. No President in modern times—perhaps
ever—has been more fiscally reckless than has the Biden Administration.

The soundness and stability of U.S. currency, the dollar, has been put at risk
because of the worst inflation in four decades. American families have been
made poorer by Biden’s economic strategy of taxing, spending, borrowing,
regulating, and printing money. The average family has seen real annual earn-
ings fall about $6,000 during the Biden Administration.' In 2022, the average
American’s 401(k) plan dropped in value from $130,700 to $103,900—more
than 20 percent.’

Why has the Biden Administration failed to achieve virtually all components of
its mission? Under the leadership of Treasury Secretary Janet Yellen, the depart-
ment has made “equity” and “climate change” among its top five priorities. The
next Administration must act decisively to curtail activities that fall outside Trea-
sury’s mandate and primary mission. Treasury must refocus on its core missions
of promoting economic growth, prosperity, and economic stability.

For a clear statement of Treasury’s mission drift, one need look no further
than Secretary Yellen’s introduction in the Treasury Department’s Fiscal Year
2022-2026 Strategic Plan:

We will have to address the structural problems that have plagued our
economy for decades: the decline in labor force participation, income and
racial inequality, and serious underinvestment in crucial public goods like
childcare, education, and physical infrastructure. And then there are rising
challenges, like climate change, which, left unchecked, will undermine every
aspect of our economy from supply chains to the financial system.*

Treasury’s mission drift into a “woke” agenda, is exemplified in a comparison
of Domestic Finance’s changed responsibilities from 2015 to 2023:

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2025 Presidential Transition Project

[2015] Domestic Finance works to preserve confidence in the U.S. Treasury
securities market, effectively manage federal fiscal operations, strengthen
financial institutions and markets, promote access to credit, and improve
financial access and education in service of America’s long-term economic
strength and stability.*

[2023] Domestic Finance works to support equitable and sustainable
economic growth and financial stability through policies to increase the
resilience of financial institutions and markets and financial wellbeing of
consumers, and to increase access to credit for small businesses and low-to-
moderate income communities.°

TREASURY DEPARTMENT ORGANIZATION
The Treasury Department is one of the few executive agencies recognized in
the U.S. Constitution. It states:

No Money shall be drawn from the Treasury, but in Consequence of Appropri-
ations made by Law; anda regular Statement and Account of the Receipts and
Expenditures of all public Money shall be published from time to time.®

The Treasury Department was established by statute in 1789. Today, it is respon-
sible for financing the federal government, promoting economic prosperity, and
ensuring the financial security of the United States. In fiscal year 2022, Treasury
received discretionary appropriations of approximately $16.4 billion.’ It also has
highly variable “mandatory” expenses (COVID-related CARES Act spending,
for example).

In fiscal year (FY) 2022, Treasury employed approximately 96,000 full-time
employees, including approximately 81,000 at the Internal Revenue Service
(IRS).8 Approximately four-fifths of Treasury’s discretionary funds are used for
IRS operations. The remaining amounts are for its offices, bureaus, and interna-
tional assistance programs.

Treasury is organized into various departmental offices,’ seven bureaus,'° and
four inspectors general."

Departmental Offices. Departmental offices are composed of divisions headed
by under-secretaries and assistant secretaries who are primarily responsible for
policy formulation and overall management of the Treasury Department.

Domestic Finance is run by the Under Secretary for Domestic Finance, to whom
the assistant secretaries for financial markets, financial stability, financial institu-
tions and the fiscal assistant secretary report. Additionally, the Financial Stability
Oversight Council (FSOC) Secretariat and the Office of Financial Research report
to the Under Secretary for Domestic Finance.

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Terrorism and Financial Intelligence. Terrorism and Financial Intelligence (TFI)
was created in 2004 as part of the larger reorganization of the U.S. government to
promote homeland security following the 9/11 terrorist attacks. TFI is charged with
the mission of disrupting international financial support for terrorists, weapons of
mass destruction proliferation, narcotics trafficking, money laundering, and other
national security threats. It is also responsible for implementing and enforcing
economic sanctions programs and supporting the wider law enforcement commu-
nity in investigating financial crimes. It is led by the Under Secretary for Terrorism
and Financial Intelligence.

International Affairs protects and supports U.S. economic prosperity and
national security by working to foster the most favorable external environment for
sustained employment and economic growth in the United States. The most crucial
functions of the Office of International Affairs relate to managing the U.S.-China
Strategic Dialogue; representing U.S. interests in the World Bank, International
Monetary Fund (IMF) and other multilateral development banks; and overseeing
the Committee on Foreign Investment in the U.S. (CFIUS). It is led by the Under
Secretary for International Affairs.

Tax Policy formulates and develops tax policies and programs and works with
Congress to get them passed into law. It reviews and issues regulations drafted by
attorneys from the IRS’s Office of Chief Counsel to administer the Internal Reve-
nue Code, negotiates tax information exchange agreements with the tax authorities
of foreign governments, participates in international tax organizations, and pro-
vides economic and legal policy analysis for domestic and international tax policy
decisions. This office also provides revenue estimates for the President’s budget.
It is led by the Assistant Secretary for Tax Policy.

Economic Policy reports on current and prospective economic developments
and assists in the determination of appropriate economic policies. This office is
responsible for the review and analysis of domestic economic issues and develop-
ments in financial markets.

The Treasurer of the United States is a statutory office that has been assigned
varying duties in recent Administrations. In addition to performing public out-
reach, treasurers have at times headed Treasury’s financial education program
and overseen the U.S. Mint and Bureau of Engraving and Printing.

Four Inspectors General provide independent audits, investigations, and over-
sight of Treasury and its programs: The Office of the Inspector General of the
Department of Treasury; Treasury Inspector General for Tax Administration;
Special Inspector General for the Troubled Asset Relief Program; and the Special
Inspector General for Pandemic Recovery.

Treasury Bureaus. Seven Treasury Department bureaus comprise 98 percent
of the Treasury work force and are responsible for carrying out specific operations
assigned to the department.

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2025 Presidential Transition Project

The Alcohol and Tobacco Tax and Trade Bureau collects federal excise taxes
on alcohol, tobacco, firearms, and ammunition, and is responsible for enforcing
and administering laws covering the production, use, and distribution of alco-
hol products.

The Internal Revenue Service is the largest of the department’s bureaus, account-
ing for about 85 percent of Treasury’s personnel and about four-fifths of its
appropriated budget. It administers and enforces U.S. tax laws.

The Bureau of Engraving and Printing develops and produces U.S. currency notes.

The Financial Crimes Enforcement Network (FinCEN) is designed to protect
the financial system from illicit use. It also administers the beneficial ownership
reporting regime mandated by the Corporate Transparency Act.”

The Bureau of the Fiscal Service provides central payment services to federal
program agencies, operates the U.S. government’s collections and deposit systems,
provides government-wide accounting and reporting services, manages the collec-
tion of delinquent debt owed to the U.S. government, borrows the money needed to
operate the government through the sale of U.S. Treasury securities (including the
state and local government series), and accounts for and services the public debt.

The United States Mint designs and mints U.S. circulating and bullion coins.

The Office of the Comptroller of the Currency (OCC) charters, regulates, and
supervises national banks and federal savings associations (thrifts) to ensure that
they operate in a safe and sound manner, provide fair access to financial services,
and comply with applicable laws and regulations. The OCC also supervises fed-
eral branches and agencies of foreign banks and has rulemaking authority for all
savings associations.

TAX POLICY

Tax policy has a powerful impact on the economy. The Treasury Department
should develop and promote tax reform legislation that will promote prosperity.
To accomplish this, tax reform should improve incentives to work, save, and invest.
This, in turn, is accomplished primarily by reducing marginal tax rates," reducing
the cost of capital and broadening the tax base to eliminate tax-induced economic
distortions by eliminating special-interest tax credits, deductions, and exclusions.
Tax compliance costs will decline precipitously if the tax system is substantially
simplified.* The Treasury Department should also promote tax competition rather
than supporting an international tax cartel.

Principles of Good Tax Policy. These are the principles governing
good tax policy.

e First, the tax system should raise the revenue necessary to fund a limited

government for constitutionally appropriate activities. It should raise this
revenue such that it: (a) applies the least economically destructive forms of

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Mandate for Leadership: The Conservative Promise

taxation;'° (b) has low tax rates on a broad, neutral tax base; (c) minimizes
interference with the operation of the free market and free enterprise; and
(d) minimizes the cost to taxpayers of compliance with and administration
of the tax system.

e Second, the tax system should minimize its adverse impact on the family
and the core institutions of civil society.

e Third, the tax system should be applied consistently—with special privileges
for none—and respect taxpayer due process and privacy rights.

The current tax system is inconsistent with these principles and needs to be
reformed to promote prosperity, reduce compliance costs, and improve fairness.
The incoming Administration should promote immediate intermediate reforms
to the existing system. It should then pursue fundamental tax reform.

Intermediate Tax Reform. The Treasury should work with Congress to sim-
plify the tax code by enacting a simple two-rate individual tax system of 15 percent
and 30 percent that eliminates most deductions, credits and exclusions. The 30
percent bracket should begin at or near the Social Security wage base to ensure
the combined income and payroll tax structure acts as a nearly flat tax on wage
income beyond the standard deduction. The corporate income tax rate should
be reduced to 18 percent. The corporate income tax is the most damaging tax in
the U.S. tax system, and its primary economic burden falls on workers because
capital is more mobile than labor.” Capital gains and qualified dividends should
be taxed at 15 percent. Thus, the combined corporate income tax combined with
the capital gains or qualified dividends tax rate would be roughly equal to the top
individual income tax rate.’* The system should allow immediate expensing for
capital expenditures and index capital gains taxes for inflation.

In addition, intermediate tax reform should repeal all tax increases that were
passed as part of the Inflation Reduction Act,” including the book minimum tax,
the stock buyback excise tax, the coal excise tax, the reinstated Superfund tax, and
excise taxes on drug manufacturers to compel them to comply with Medicare price
controls. The next Administration should also push for legislation to fully repeal
recently passed subsidies in the tax code, including the dozens of credits and tax
breaks for green energy companies in Subtitle D of the Inflation Reduction Act.”°

Universal Savings Accounts. All taxpayers should be allowed to contribute
up to $15,000 (adjusted for inflation) of post-tax earnings into Universal Savings
Accounts (USAs). The tax treatment of these accounts would be comparable to
Roth IRAs. USAs should be highly flexible to allow Americans to save and invest as
they see fit, including, for example, investments in a closely held business. Gains
from investments in USAs would be non-taxable and could be withdrawn at any

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time for any purpose. This would allow the vast majority of American families to
save and invest without facing a punitive double layer of taxation.

Entrepreneurship. To encourage entrepreneurship, the business loss limita-
tion should be increased to at least $500,000. Businesses should also be allowed to
fully carry forward net operating losses. Extra layers of taxes on investment and
capital should also be eliminated or reduced. The net investment income surtax
and the base erosion anti-abuse tax should be eliminated. The estate and gift tax
should be reduced to no higher than 20 percent, and the 2017 tax bill’s temporary
increase in the exemption amount from $5.5 million to $12.9 million (adjusted
for inflation) should be made permanent.”! The tax on global intangible low-taxed
income should be reduced to no higher than 12.5 percent, with the 20 percent
haircut on related foreign tax credits reduced or eliminated.”

All non-business tax deductions and exemptions that were temporarily sus-
pended by the 2017 tax bill should be permanently repealed, including the bicycle
commuting expense exclusion, non-military moving expense deductions, and the
miscellaneous itemized deductions.’ The individual state and local tax deduction,
which was temporarily capped at $10,000, should be fully repealed. Deductions
related to educational expenses should be repealed. Special business tax pref-
erences, such as a special deduction for energy-efficient commercial building
properties, should be eliminated.

Wages vs. Benefits. The current tax code has a strong bias that incentivizes
businesses to offer employees more generous benefits and lower wages. This limits
the freedom of workers and their families to spend their compensation as they
see fit—and it can trap workers in their current jobs due to the jobs’ benefit pack-
ages. Wage income is taxed under the individual income tax and under the payroll
tax. However, most forms of non-wage benefits are wholly exempt from both of
these taxes.

To reduce this tax bias against wages (as opposed to employee benefits), the
next Administration should set a meaningful cap (no higher than $12,000 per year
per full-time equivalent employee—and preferably lower) on untaxed benefits
that employers can claim as deductions. Employee benefit expenses other than
tax-deferred retirement account contributions should count toward the limita-
tion, whether offered to specific employees or whether the costs relate to a shared
benefit like building gym facilities for employees.?> Tax-deferred retirement con-
tributions by employers should not count toward this limitation insofar as they
are fully taxable upon distribution. Only a percentage of Health Savings Accounts
(HSA) contributions (which are not taxed upon withdrawal) should count toward
the limitation.*° The limitation on benefit deductions should not be indexed to
increase with inflation.”” Employers should also be denied deductions for health
insurance and other benefits provided to employee dependents if the dependents
are aged 23 or older.

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Fundamental Tax Reform. Achieving fundamental tax reform offers the
prospect of a dramatic improvement in American living standards and an equally
dramatic reduction in tax compliance costs. Lobbyists, lawyers, benefit consul-
tants, accountants, and tax preparers would see their incomes decline, however.
The federal income tax system heavily taxes capital and corporate income and
discourages work, savings, and investment.

The public finance literature is clear that a consumption tax would minimize
government’s distortion of private economic decisions and thus be the least eco-
nomically harmful way to raise federal tax revenues.”* There are several forms that
a consumption tax could take, including a national sales tax, a business transfer
tax, a Hall-Rabushka flat tax,” or a cash flow tax.*°

Supermajority to Raise Taxes. Treasury should support legislation instituting
a three-fifths vote threshold in the U.S. House and the Senate to raise income or
corporate tax rates to create a wall of protection for the new rate structure. Many
states have implemented such a supermajority vote requirement.

Tax Competition. Tax competition between states and countries is a positive
force for liberty and limited government.” The Biden Administration, under the
direction of Treasury Secretary Janet Yellen, has pushed for a global minimum
corporate tax that would increase taxation and the size of government in the US.
and around the world. This attempt to “harmonize” global tax rates is an attempt
to create a global tax cartel to quash tax competition and to increase the tax burden
globally. The U.S. should not outsource its tax policy to international organizations.

Organization for Economic Co-operation and Development. The Organi-
zation for Economic Co-operation and Development (OECD), in conjunction with
the European Union, has long tried to end financial privacy and impose regulations
on countries with low (or no) income taxes. In fact, on tax, environmental, corpo-
rate governance and employment issues, the OECD has become little more than
a taxpayer-funded left-wing think tank and lobbying organization.** The United
States provides about one-fifth of OECD’s funding.** The U.S. should end its finan-
cial support and withdraw from the OECD.

TAX ADMINISTRATION

The Internal Revenue Service is a poorly managed, utterly unresponsive and
increasingly politicized agency, and has been for at least two decades. It is time for
meaningful reform to improve the efficiency and fairness of tax administration,
better protect taxpayer rights, and achieve greater transparency and accountability.
A substantial number of the problems attributed to the IRS are actually a function
of congressional action that has made the Internal Revenue Code ridiculously
complex, imposed tremendous administrative burdens on both the public and the
IRS, and given massive non-tax missions to the IRS. But the culture, administrative
practices, and management at the IRS need to change.

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Doubling the IRS? The Inflation Reduction Act contains a radical $80 billion
expansion of the IRS—enough to double the size of its workforce.** Unless Congress
reverses this policy, the IRS will become much more intrusive and impose still
greater costs on the American people.

The Biden Administration has also sought to make the tax system’s adminis-
trative burden much worse in other ways. For example, it has proposed creating a
comprehensive financial account information reporting regime that would apply to
all business and personal accounts with more than $600. Banks would be required
to collect the taxpayer identification numbers of and file a revised Form 1099-K
for all affected payees, as well as provide additional information.** This massive
increase in the scope and breadth of information reporting should be unequivo-
cally opposed.

Management. The IRS has approximately 81,000 employees.*° Of those, only
two are presidential appointments—the Commissioner and the Chief Counsel.*”
As a practical matter, it is impossible for these two officials to overcome bureau-
cratic inertia and to implement policy changes that the IRS bureaucracy wants to
impede. That is why, notwithstanding decades of sound and fury, almost nothing
has changed at the IRS.

For the IRS to change and become more accountable, more transparent, and
better managed, there is a need to increase the number of Presidential appoint-
ments subject to Senate confirmation, and not subject to Senate confirmation, at
the IRS. At the very least, Congress should ensure that the Deputy Commissioner
for Services and Enforcement, the Deputy Commissioner for Operations Support,
the National Taxpayer Advocate, the Commissioner of the Wage and Investment
Division, the Commissioner of the Large Business and International Division,
the Commissioner of the Small Business Self-Employed Division, and the Com-
missioner of the Tax Exempt and Government Entities Division are presidential
appointees.*®

Information Technology. Despite the investment of billions of dollars for at
least two decades, IRS information technology (IT) systems remain deficient.*°
The IRS inadequately protects taxpayer information, its IT systems do not ade-
quately support operations or taxpayer services, and its matching and detection
algorithms are antiquated.

These problems are not primarily about resources. The IRS has spent approxi-
mately $27 billion on IT during the past decade, with $7 billion of that designated
as “development, modernization and enhancement.“*° The problem is one of man-
agement. The bureaucracy is not up to the task, and neither Congress nor a long
line of IRS commissioners has forced changes.

A Deputy Commissioner for Operations Support with strong IT management
skills should be appointed by the IRS Commissioner or the President (once the
position is made a presidential appointment). The various subordinates to the

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Deputy Commissioner should be replaced. A thorough review of IT contracts

should be conducted. The Integrated Modernization Business Plan* should be

systematically reviewed and a version of it cost-effectively implemented. An over-
sight board composed of private sector IT experts should be established and given

the authority to conduct meaningful, contemporaneous oversight.

TAXPAYER RIGHTS AND PRIVACY

Legal protections for taxpayer rights and privacy have improved during the past
three decades, but they remain inadequate.** Congress should do more. For exam-
ple, interest on overpayments should be the same as interest on underpayments
rather than the government receiving a higher rate, the time limit for taxpayers
to sue for damages for improper collection actions should be extended, the juris-
diction of the Tax Court should be expanded, and the tax penalty system should
be reformed by rationalizing the penalty structure and reducing some of the most
punitive penalties.”

The Office of the Taxpayer Advocate was created by Congress to assist taxpay-
ers when the IRS bureaucracy is unresponsive or negligent. About 1.7 percent of
the IRS budget goes to this function.“ Each year, the Office handles more than
250,000 cases, helping taxpayers to deal with the IRS. Each year, it issues nearly
2000 taxpayer assistance orders, a form of administrative injunction, forcing the
rest of the IRS to stop taking unwarranted actions.**

Congress should provide the Office of the Taxpayer Advocate with greater
resources so that it may better assist taxpayers suffering from wrongful IRS actions.
The office should also be strengthened by, among other things:

e Ensuring that the National Taxpayer Advocate can make his or her own
personnel decisions to protect its independence;

e Ensuring NTA access to files, meetings, and other information needed to
assist taxpayers or investigate IRS administrative practices;

e Requiring the IRS to address the NTA’s comments in final rules
and including the NTA in deliberations prior to the release of a
proposed rule; and

e Authorizing the NTA to file amicus briefs independently.
Administrative Burden. In 2021, Americans filed 261 million tax returns and
an astounding 4.7 billion information returns (such as Form W-2s, Form 1098s

and Form 1099s).*° Complying with tax law costs Americans more than $400 bil-
lion annually, or about 2 percent of gross domestic product.*” Although the IRS

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administers these reporting programs, most of this expense is mandated by Con-
gress, not the IRS.

One of the primary reasons that Congress mandates ever-increasing infor-
mation reporting is that the Treasury Department and the Joint Committee on
Taxation staff almost always overestimate how much revenue will be gained from
still more burdensome information reporting, and they do not estimate or report
private compliance costs. Congress and the Treasury Department must undertake
a serious review of the information reporting regime and reduce the burden on the
public—especially small businesses. Small businesses suffer disproportionately
from complexity and administrative burdens. Costs do not increase linearly with
size, so elevated administrative costs have an adverse effect on the competitiveness
of small firms.

Budget. The operating budget of the IRS should be held constant in real terms.
The resources allocated to the Office of the Taxpayer Advocate should be increased
by at least 20 percent (about $44 million). The Office of Equity, Diversity, and
Inclusion should be closed. Provided that IT management is changed; an effective,
well-considered implementation plan is adopted; and serious oversight is put in
place, additional resources dedicated solely to IT modernization may be warranted.

INTERNATIONAL AFFAIRS

The Treasury Department should withdraw from Senate consideration the
Protocol Amending the Convention on Mutual Administrative Assistance in Tax
Matters.*® The protocol will lead to substantially more transnational identity theft,
crime, industrial espionage, financial fraud, and suppression of political oppo-
nents and religious or ethnic minorities by authoritarian and corrupt governments,
including China, Colombia, Nigeria, and Russia. Unlike the original multilateral
convention, the amended convention is open to all governments—including many
that are either hostile to the United States, have serious corruption problems, or
have inadequate privacy protections. The new Administration should also oppose
the multilateral Competent Authority Agreement on Automatic Exchange of
Financial Account Information.”

International organizations such as the OECD, the World Bank, and the Inter-
national Monetary Fund espouse economic theories and policies that are inimical
to American free market and limited government principles. The global elites who
operate the IMF regularly advance higher taxes and big centralized government.
The IMF has intervened in American policy debates—and has even recommended
that the US. raise taxes. The IMF’s record of advancing global financial stability
has been mixed at best. Its development assistance and lending programs in third-
world countries have more often than not retarded growth rather than advancing it.

The Treasury Department plays an important role in these international
institutions and should force reforms and new policies. The U.S., however, should

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withdraw from both the World Bank and the IMF and terminate its financial con-
tribution to both institutions.

If the US. is to provide economic assistance or humanitarian aid to other nations,
it should do so unilaterally—not through the pass-throughs of international aid orga-
nizations, non-governmental organizations, or other nations. These organizations
and countries simply create expensive middle-men, while U.S. funds are intercepted
before being distributed to those in need. Also, these foreign entities have interests
that do not coincide with American national security and economic interests.

FISCAL RESPONSIBILITY

Treasury should make balancing the federal budget a mission-critical objective.
The federal budget absorbs enormous resources from the economy, both in money
taken from taxpayers and in money borrowed. The budget should be balanced by
driving down federal spending while maintaining a strong national defense and
not raising taxes.

To reduce interest payments on the debt, Treasury should lock in current rel-
atively low interest rates by issuing longer duration bonds, and even consider
creating a 50-year treasury bill. Most of the federal debt rolls over on average about
every three to four years. But interest rates, even with the latest Federal Reserve
rate increases, are still below the 5 percent historical average. Treasury would thus
save taxpayers money during the next several decades by issuing fewer short-term
notes that will probably have to be rolled over at higher rates in the future.

To promote transparency of finances, each year Americans should receive a
financial statement of the U.S. government alerting citizens of the revenues, expen-
ditures, deficit, and debt for the preceding fiscal year. The statement should also
include this individual family’s pro-rata share of the debt based on family size.

INTERNATIONAL COMPETITIVENESS

The Treasury must act more assertively in international financial institutions to
protect and advance U.S. national interests—and oppose those that do not. It should
employ acarrot-and-stick approach by increasing its activity and commitment to
those financial institutions that are willing and able to adjust to this new approach
and by zeroing out or potentially exiting those institutions that rely on U.S. capital
while advancing agendas that run counter to US. interests.

e Amajor emphasis of effecting this change must be the addition of a large
new cadre of U.S. professionals and contractors at these international

financial institutions.

e TheU.S. must insist on the hiring and support of this human capital as a
condition to future funding.

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e The US. should also examine increasing or decreasing its ownership levels
in these institutions in order to achieve maximum leverage.

CHINA AND OTHER GEOPOLITICAL THREATS

Committee on Foreign Investment in the United States. The interagency
Committee on Foreign Investment in the United States should realign its priorities
to meet the United States’ current foreign policy threats, especially from China.

On October 20, 2022, the Treasury Department, which chairs CFIUS, adopted
the first-ever CFIUS Enforcement and Penalty Guidelines® on the committee’s
national security risk mitigation requirements. However, there are no clear rules
that guide CFIUS on mitigation monitoring, nor is there a published penalty sched-
ule to standardize accountability when CFIUS pursues a civil money penalty for
violators. In addition, Treasury—as chair of the committee—runs an opaque pro-
cess that biases committee procedure toward corporate interests and away from
national security interests. Finally, the committee’s jurisdiction does not extend
over greenfield investments that Chinese state-owned enterprises have historically
pursued in the United States, which leaves America vulnerable to an instrument
of Chinese economic statecraft.

Given these issues, the next steps for CFIUS should be to develop a more
coherent—and transparent—mitigation monitoring program to complement the
enforcement guidelines, give CFIUS agencies in charge of national security con-
cerns an equal voice at the table, and petition Congress to amend the law to cover
Chinese greenfield investments.

CFIUS should publish a penalty schedule for violations of CFIUS reporting and
mitigation requirements. Publishing a penalty schedule for CFIUS violations will
reduce the discretion of the committee to waive penalties or impose mere “wrist
slap” costs on violators of the law. Additionally, a standardized penalty schedule
would likely increase the deterrence of CFIUS enforcement by reducing the per-
ception among parties to covered transactions that they can avoid enforcement
by the committee or secure special exceptions based on appeals to the commit-
tee’s discretion.

As alegal matter—and in application by CFIUS—mitigation monitoring has
developed as the Wild West. There are no clear rules that guide the entire com-
mittee on mitigation monitoring, nor is there the same level of oversight or
accountability within and among the agencies as applies when CFIUS reviews
a transaction or when it pursues a civil money penalty. Indeed, it is a credit to
transaction parties and the professionalism of the governmental officials and con-
tractors who conduct mitigation monitoring on behalf of the government that, by
and large, mitigation monitoring has worked adequately during the last several
decades. But dependency on the personality and capabilities of individuals creates
unnecessary risk both for CFIUS and for transaction parties.

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Congress should make the Department of Defense (DOD) a CFIUS co-chair
with the Department of Treasury. Making DOD an official CFIUS co-chair along
with Treasury will establish a balanced committee process by elevating national
security interests to an equal stature. The committee is currently imbalanced
toward the interests of corporate America because Treasury is the sole chair of
CFIUS and, in practice, runs a process that is not fully transparent and which biases
it from the national security interests represented by DOD and the Intelligence
Community (IC).

For example, Treasury representatives will consult with the Commerce Depart-
ment and the United States Trade Representative—which tend to favor permitting
covered transactions to occur with little to no mitigation requirements—and these
representatives will then obscure the results and purposes of such sidebar meet-
ings from DOD and IC representatives. This hampers DOD, IC, and sometimes
even State Department representatives from full participation in the process or
from advocating national security interests as well as they should.

Greenfield Investments. Congress should close the loophole on greenfield
investments and require CFIUS review of investments in U.S.-based greenfield
assets by Chinese-controlled entities to assess any potential harm to U.S. national
and economic security. In the 2018 Foreign Risk and Review Modernization Act
(FIRRMA),* one important category of foreign transactions left out of the bill was
greenfield investments, particularly by Chinese state-owned enterprises (SOEs).
Greenfield investments by Chinese SOEs pose a unique threat, and they should be
met with the highest scrutiny by all levels of government.

Greenfield investments result in the control of newly built facilities in the US.,
and they were not addressed in FIRRMA primarily because governors and state
governments embrace them. That is understandable; they typically bring the
promise of creating American jobs. However, the goal of such Chinese SOEs is to
siphon assets, technological innovation, and influence away from U.S. businesses
in order to expand the global presence of the Chinese Communist Party. While the
Chinese government keeps its domestic markets largely insulated from foreign
influence, it regularly invests in the U.S. and other countries under the “green-
field” model. Firms fully owned by China’s Communist regime are increasingly
buying land, building factories, and taking advantage of state and local tax breaks
on American soil.

Treasury should examine creating a school of financial warfare jointly with
DOD. If the US. is to rely on financial weapons, tools, and strategies to prosecute
international defensive and offensive objectives, it must create a specially trained
group of experts dedicated to the study, training, testing, and preparedness of these
deterrents. Recent experience has demonstrated that the U.S. cannot depend on
the rapid development and deployment of untested, academically developed finan-
cial actions, stratagems, and weapons on an ad hoc basis.

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Treasury must also seriously evaluate U.S. foreign direct investment in China.
Particular focus should be paid to investments in CCP or other state-owned enter-
prises, investments that result in technology transfers from the U.S. to China,
investments that enhance China’s military capacity, and investments that pose
risks to critical U.S. supply chains by sourcing critical components or feedstocks
in China. An enhanced reporting system is warranted, and greater legal authority
and restrictions are appropriate.

IMPROVED FINANCIAL REGULATION

One of the priorities of the incoming Administration should be to restructure
the outdated and cumbersome financial regulatory system in order to promote
financial innovation, improve regulator efficiency, reduce regulatory costs, close
regulatory gaps, eliminate regulatory arbitrage, provide clear statutory authority,
consolidate regulatory agencies or reduce the size of government, and increase
transparency.

Merging Functions. The new Administration should establish a more stream-
lined bank and supervision by supporting legislation to merge the Office of the
Comptroller of the Currency, the Federal Deposit Insurance Corporation, the
National Credit Union Administration, and the Federal Reserve’s non-monetary
supervisory and regulatory functions.

U.S. banking law remains stuck in the 1930s regarding which functions finan-
cial companies should perform. It was never a good idea either to restrict banks
to taking deposits and making loans or to prevent investment banks from taking
deposits. Doing so makes markets less stable. All financial intermediaries function
by pooling the financial resources of those who want to save and funneling them
to others that are willing and able to pay for additional funds. This underlying
principle should guide U.S. financial laws.

Policymakers should create new charters for financial firms that eliminate activ-
ity restrictions and reduce regulations in return for straightforward higher equity
or risk-retention standards. Ultimately, these charters would replace government
regulation with competition and market discipline, thereby lowering the risk of
future financial crises and improving the ability of individuals to create wealth.

Dodd-Frank Revisions. Congress should repeal Title I, Title II, and Title VIII
of the Dodd-Frank Act.” Title I of Dodd—-Frank created the Financial Stability
Oversight Council, a kind of super-regulator tasked with identifying so-called
systemically important financial institutions and singling them out for especially
stringent regulation. The problem, of course, is that this process effectively iden-
tifies those firms regulators believe are “too big to fail.”°*

Title VIII of Dodd-Frank gives the FSOC similarly broad special-designation
authority for specialized financial companies known as financial market utilities.™
Title II of Dodd-Frank established the controversial provision known as orderly

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liquidation authority (OLA), the law’s alternative to bankruptcy for large financial
firms. OLA was based on the faulty premise that large financial institutions cannot
fail in a judicial bankruptcy proceeding without causing a financial crisis. It gives
such companies access to subsidized funding and creates incentives for manage-
ment to overleverage and expand high-risk investments.* Congress should repeal
each of these provisions to guard against bailouts and too-big-to-fail problems.*°

Treasury plays a role in funding the conservatorships of Fannie Mae and Freddie
Mac. It should work to end the conservatorships and move toward privatization of
these massive housing finance agencies. This would restore a sustainable housing
finance market with a robust private mortgage market that does not rely on explicit
or implicit taxpayer guarantees.

Direct government ownership has worsened the risks that government-spon-
sored enterprises (GSEs) pose to the mortgage market, and stock sales and other
reforms should be pursued. Treasury should take the lead in the next President’s
legislative vision guided by the following principles:

e Fannie Mae and Freddie Mac (both GSEs) must he wound down in an
orderly manner.

e The Common Securitization Platform® should be privatized and
broadly available.

e Barriers to private investment must be removed to pave the way for a robust
private market.

e The missions of the Federal Housing Administration and the Government
National Mortgage Association (“Ginnie Mae“) must he right-sized to serve
a defined mission.

ANTI-MONEY LAUNDERING AND BENEFICIAL
OWNERSHIP REPORTING REFORM

The Financial Crimes Enforcement Network is a relatively small bureau within
the Treasury Department with approximately 285 employees anda FY 2022 budget
of $173 million.** Although FinCEN makes a significant contribution to law enforce-
ment efforts, it also does demonstrable, substantial and widespread economic harm
because it: (1) is largely oblivious to those adverse economic effects; (2) conducts
almost no meaningful cost-benefit analysis or retrospective review of regulations;
(3) has been subject to extraordinarily lax oversight by both Congress and the Trea-
sury Department; and (4) demands total transparency by those it regulates but is
itself disturbingly and purposefully opaque. For example, FinCEN no longer issues
an annual report® and no longer publishes cash transaction report (CTR) data.

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There were 2 .7 million suspicious activity reports (SARs) filed in 2021.° The
number of CTRs filed were approximately 10 times that number." In 2014, FinCEN
anti-money laundering/countering the financing of terrorism (AML-CFT) rules
cost an estimated $5 billion to $8 billion per year.** Undoubtedly, this cost is now
substantially higher both because of inflation and because the rules have become
more onerous. Yet there is little evidence that this massive expenditure of
resources is doing much good,” and there is no evidence regarding which aspects
of the AML-CFT regime are effective and which are not. The AML-CFT regimeisa
major contributing factor causing the decline in the number of small broker-deal-
ers and the decline in the competitiveness of community banks.

Congress must require FinCEN to annually publish data regarding:

e The number of SARs filed;
e The number of CTRs filed;®

e The number of AML-CFT prosecutions, disaggregating those in which the
AML-CFT prosecution is stand-alone and in which the prosecution is an
add-on count connected to other predicate crime;

e The number of AML-CFT convictions (similarly disaggregated);

e The number and aggregate amount of AML-CFT fines imposed and the type
of institution upon which the fine was imposed; and

e Annual estimates of the aggregate costs imposed on private entities by the
AML-CFT regime.°”

Without this data, it is impossible for policymakers to make an informed judg-
ment about the effectiveness of the AML-CFT regime. Congress should also require
both FinCEN and the Government Accountability Office to undertake separate
evaluations regarding which aspects of the AML-CFT regime are effective and
which are not. FinCEN should be required to undertake a thorough retrospec-
tive review of its regulations and various statutory requirements and report to
Congress on its findings in a publicly available report. Anecdotes and assurances
from FinCEN staff that all is well—but that even more onerous requirements are
needed—are not enough.

Congress should repeal the Corporate Transparency Act, and FinCEN should
withdraw its poorly written and overbroad beneficial ownership reporting rule.
Both are targeted at the smallest businesses in the U.S. (those with 20 or fewer
employees) and will do nothing material to impede criminal finance. The FinCEN

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beneficial ownership reporting rule will impose costs exceeding $1 billion annu-
ally and is exceedingly poorly drafted. FinCEN itself estimates that more than
33 million businesses will be affected and that costs will be $547 million to $8.1
billion annually.”

THE “EQUITY” AGENDA

Under the Biden Administration, the Treasury Department has appointed a
Counselor for Racial Equity, established an Advisory Committee on Racial Equity,
and created an office for Diversity, Equity, Inclusion, and Accessibility. All these
should be eliminated. Treasury has created several new offices to promote “equity”
and has made this its first of five strategic goals in its Fiscal Year 2022-2226
Strategic Plan. “Equity” is identified as a cross-cutting theme in 15 of 19 of the
plan’s objectives.

The avowed purpose of these initiatives is to implement policies that delib-
erately favor some races or ethnicities over others. The casual acceptance and
rapid spread of racist policymaking in the federal government must be forcefully
opposed and reversed. The next conservative Administration should take affirma-
tive steps to expose and eradicate the practice of critical race theory and diversity,
equity, and inclusion (DEI) throughout the Treasury Department.

These steps will include:

e Identify every Treasury official who participated in DEI initiatives and
interview him or her for the purpose of determining the scope and nature of
these initiatives and to ensure that such initiatives are completely ended.

e Make public immediately all communications relating to the work of the
Treasury’s critical race theory and DEI initiatives.

e Treat the participation in any critical race theory or DEI initiative,
without objecting on constitutional or moral grounds, as per se grounds for
termination of employment.

e Expose and make public all training materials and initiatives designed to
single out any race, ethnicity, or sex for special treatment.

The Administration should eliminate the 25-member Treasury Advisory Com-
mittee on Racial Equity.

CLIMATE-RELATED FINANCIAL RISK

Treasury has created a new departmental office, “Climate Hub,” and has made
“combating climate change” one of the Biden Treasury Department’s top five

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principal goals. The next Administration should eliminate the Climate Hub Office
and withdraw from climate change agreements that are inimical to the prosperity
of the United States.

The Climate Hub office “coordinates Treasury’s work to inform, guide, incen-
tivize, and mobilize financial flows for climate mitigation and climate adaptation
and supports the broader alignment of the financial system with a path to net-
zero emissions by mid-century.“ According to the Biden Administration’s Fiscal
Year 2022-2026 Strategic Plan for Treasury, the fourth of five Treasury strategic
goals reads:

Combat Climate Change

The United States and the world face a climate crisis and a narrowing
window of action to avoid the worst impacts of climate change. At the same
time, the transition to alow carbon economy represents a historic economic
opportunity for the U.S. and global economy. The U.S. federal government
must work alongside our domestic and international partners to respond
ambitiously to tackle the challenges of climate change, adapt to an already
changing climate, mitigate the risks, and position the global economy for
clean and sustainable growth.”

Yet history shows that economic growth and technological/scientific advance
through human ingenuity are by far the best ways to prevent and mitigate extreme
weather events. Moreover, virtually all of the initiatives that the Biden Administra-
tion has adopted would, even if successful, have a de minimis impact on changing
global weather patterns, in part because most nations—notably China—are not
cooperating with climate summits and international agreements. Virtually all
nations, for example, that signed the Paris Agreement” have not met their treaty
obligations. Such routinely violated treaties weaken the U.S. economy with no off-
setting societal benefits. To that end, the next conservative Administration should
withdraw the U.S. from the U.N. Framework Convention on Climate Change” and
the Paris Agreement.

The next Administration should use Treasury’s tools and authority to promote
investment in domestic energy, including oil and gas. It should reverse support for
international public- (and private-) based efforts promoting Environmental, Social,
and Governance” and Principles for Responsible Investment,” both of which have
badly damaged U.S. energy security.

OTHER REFORMS

U.S. Coast Guard and the Bureau of Alcohol, Tobacco, Firearms, and
Explosives. Congress should examine whether to return the Treasury’s former

— 709 —

Mandate for Leadership: The Conservative Promise

in-house law enforcement capabilities via the return of the United States Coast
Guard and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Bringing
these agencies back from the Department of Homeland Security and the Depart-
ment of Justice, respectively, would allow Treasury, in the case of U.S. Coast Guard,
to increase border security via a vigilance with respect to economic crimes (for
example, drug smuggling and tax evasion).

U.S. Trade and Development Agency. Congress should eliminate the U.S.
Trade and Development Agency (USTDA). The USTDA is intended to help com-
panies create U.S. jobs through the export of U.S. goods and services for priority
development projects in emerging economies. The USTDA links U.S. businesses
to export opportunities by funding project planning activities, pilot projects, and
reverse-trade missions while creating sustainable infrastructure and economic
growth in partner countries.

These activities more properly belong to the private sector. The best way to
promote trade and development is to reduce tariff and non-tariff trade barriers.
Another way is to reduce the federal budget deficit, and thereby federal borrowing
from abroad, freeing more foreign dollars to be spent on U.S. exports instead of
federal treasury bonds.

Other Issues. Many Treasury Department issues cut across multiple parts of
Treasury or other governmental agencies. Several are discussed in this chapter,
but not all can be covered here in depth. Other issues of concern include China,
cybersecurity, digital assets, digital services taxes, international debt defaults, Iran,
Social Security and Medicare Trust Funds and private sector pensions, sanctions
policy, and treasury auction and debt issuance.

AUTHORS? NOTE: The preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but Monica
Crowley, Tom Dans, John Berlau, Austin Bramwell, Preston Brashers, Alexandra Harrison Gaiser, Nathan Hitchen,
Adam Korzeniewski, and Jonathan Moy deserve special mention. The authors alone assume responsibility for the
content of this chapter, and no views expressed herein should be attributed to any other individual.

— 710 —

2025 Presidential Transition Project

ENDNOTES

eNO

14.

15.

16.

EJ Antoni, “Biden Keeps Making Clai
Heritage Foundation Commentary,
comme
“Fide
Are Ri
pressrt
accou
See
2022,

ity 2022 Retirement Analysis:

eases/fidelity--2022-retirem

. Departmen
tps://home.
arch 18, 2023).
U.S. Department of
homet
Domestic Finance, U
U.S. Constitution, ar
bid., p. ES 1.
ncluding direct and reimbursable emp
Staffing (Direct and Reimbursable)” p.

reasury.gov/sys

24TH 32

S. Department of
| sec. 9.

U.S. Department of the Treasury, “Bure
arch 18, 2023).

U.S. Department of the Treasury, O
(accessed March 19, 2023).
William M (Mac) Thornberry Nation
§§ 6001-6511.

February 8, 2023,
n the Midst of Infl
ng,” table, “Average Retirement Account Balan
en
-ba/s/095bb4a8-cf3a-484e-a911-bc0c61c460

em/files/266/CO

easury.gow/system/files/266/A

fice of the Inspec

-analysis--in-t

ES 4.

aus,” https://h

ms About the Economy That Just Aren’t True. These Facts Don’t Lie,”
httos://www.heritage.org/markets-and-finance/
ntary/biden-keeps-making-claims-about-the-economy-just-arent-true-these.

ation and Uncertainty, Retirement Account Balances
ces,” February 23, 2023, https://newsroom fidelity.com/
he-midst-of-inflation-and-uncertainty--retirement-

f (accessed March 22, 2023).

t of the Treasury, Fiscal Year 2022-2026 Strategic Plan and Budget Request for FY 2023,
BINED-CJ-Web-Version-FY-2023.pdf (accessed

he Treasury, Agency Financial Report: Fiscal Year 2015, November 16, 2015, p.4 https://

FR-FY15-508.pdf (accessed March 19, 2023).
he Treasury https://home.treasury.gov/about/offices/domestic-finance.

or General, “Overview,” https://oig.treasury.gov

al Defense Authorization Act for Fiscal Year 2021, Public Law 116-283,

oyees. See ibid., “Fiscal Year Comparison of Full-Time Equivalent (FTE)

U.S. Department of the Treasury, “Offices,” httos://home.treasury.gov/about/offices (accessed March 18, 2023).
ome.treasury.gov/about/bureaus (accessed

See, for example, Timothy Vermeer, “The Impact of Individual Income Tax Changes on Economic Growth,” Tax

Foundation
ndividual-In
and José Luis
Economics, Vol
The current tax
ensuring that th
user cost of cap
properly, or tha

Fiscal Fact No. 793, Jun

ontiel Olea, “Marginal 1

e private rate of ret
ital, that all factor in
the tax is a consump
W. Jorgenson, “Tax Po

urn

E. Hall and Da
3 (June, 1967),
9, 2023). See
Recent Literature,” in John W.
and Implications (Cambridge,
University of Ca
(accessed March
Scott A.
https://fi
Fichtner
papers.ssrn.com/sol3/papers.c
n forma
See John
ate Dou

ifornia, Berkeley, Sep
19, 2023).
Hodge, “The Complian

ce Cos

on price

e 2022, h
come-Tax-Changes-on-Economi
. 133, No. 4 (November 2018),
system is not neutral toward

ax Ra

equals the soci

bas
d Investmen

icy an

p. 391-414, https://web.stanford.edu/~rehall/Tax-Poli
so Kevin A. Hassett and Kath

ryn Newmar’

A: MIT Press, 2008), and Alan J. Aue

—711—-

al rate of retur'
comes are taxed once
ion tax. For the

his neutra

and equal
ic user COS
Behavior,’

, “Taxation and Business Behavior: A Review of t
Diamond and George R. Zodrow, eds.,

tps://files.taxfoundation.org/20220610142519/The-Impact-of-
c-Growth-2.pdf (accessed March 18, 2023), and Karel Mertens
es and Income: New Time Series Evidence,” Quarterly Journal of
pp. 1803-1884.
investment. T

ity criterion is sometimes expressed as
n, that the tax system does not raise th
y, that the tax system defines income

* American Economic Review, Vol. 57,
cy-AER-June-1967.pdf (accessed March

ember 2005, http://eml.berkeley.edu//~auerbach/capitalspending.pd

s of IRS Regulations,” Tax Founda
les.taxfoundation.org/legacy/docs/TaxFoundation_FF512.pdf (accessed March 19, 2023), and Jason J.
and Jacob M. Feldman, “The Hidden Costs of Tax Compliance,”
mPabstract_id=2267971 (accessed March 19, 2023).
terms, tax policy should seek to minimize the excess burden or deadweight
Creedy, “The Excess Burden of Taxation and Why it (Approxim
R bles,” New Zealand Treasury Working Paper No. 03/29, Decem
bitstream/10419/205534/1/twp2003-29.pdf (accessed March 19, 2023). See also, for example, N. Gregory
ankiw, Principles of Economics, 4th ed. (South-Western College Pub, 2006), ch. 8, 0
heory, microeconomics, or principles of economics.

bach, “Taxation and Capital Spending,”

ion Fiscal Fact No. 512, June 2016,
ercatus Cen
oss of the tax system.

ples When the Tax
ber 2003, httos://www.econstor.eu/

ately) Quadru

many other textbooks

of capital analysis with taxes, see Rober
0.

he
Fundamental Tax Reform: Issues, Choices,

er, May 20, 2013, https://

22.

23.

24.
25.
26.
27.

28.

29.

30.

31.

32.

“What's

“The Choice Be

Mandate for Leadership: The Conservative Promise

For a detailed discussion, see David R. Burton, “Tax Reform: Eliminating the Double Taxation of Corporate
Income,” Heritage Foundation Backgrounder No. 3216, May 18, 2017, https://www.heritage.org/sites/default/

files/2017-05/BG3216.pdf.

One hundred dollars in corporate income less an 18 percent tax leaves $82. A 15 percent capital gains tax or

quali

course, abstracts away from certain timing issues.

Inflation Reduction Act, Public Law 117-169.
Ibid.
Tax Cuts

before in

and Jobs Act, Pub
lation adjustmen
ew: Estate and Gi
small-businesses-self-emp
The effective tax rate on
intangible low-taxed income
For miscellaneous itemized
hat were suspended by the 2017 tax bill (oth
This includes the local lodgi
modifications to the deduc
imitation on

oyed/whats-new-

ion for personal c

Employer-provided childcare
HSAs are flexible and portab
For additional revenue to fun
benefit deductions.

Early versions of the 2017 tax
cash flow tax, a form of consumption tax. A t
and only once—results in hig

e, and they help
d pro-growth ta

et al., “Optima
47-174, https://pubs.aeaweb.
ween
tos://www.nber.org/system/fi
Charles E. Walker and Mark A. B
arper and Row, Ballinger, 1987).
oover Institu
hoover.org/research/simplifying-
David R. Burton, “Four Conserva
Backgrounder No. 2978, December 7, 2022, h
plans-equivalent-economic-resu

ow-income Americans from federal tax liabi
Daniel J. Mitchell and Ch
Defend It (Washington,
Tax Competition Is a Bu

'
DC: Cato
wark Agains

arch 19, 2023).
James M. Robers et al., “Organization
Should Do,” Heritage Fou
sites/default/files/2021-03/BG3593.pdf; Pres
Foundation Commentary, February 4, 2022,

for Eco

oreign-derived intangible income
deductions, see In

ng expense deduc

bill envisioned reformin

Growth
axes/commentary/constitutional-checks-and-balances-tax-competition-bulwark-against-growth

ndation Backgrounder No. 3593, Ma
on Brashers. “The OECD Crusade To Raise Taxes,” Heritage
itage.org/taxes/commentary/the-oecd-crusade-

t-
sh

estate-and-gi

ernal Reven
er than those re
ion and enterta
asualty and thef

itemized deductions should be permanently eliminated.

Bonus depreciation provisions applied to specific industries sh
expenses should also count toward the limitation on benefit deductions.

ain costs by
s, lawmaker

con
X CU

ax syste

her output and higher incomes. Usually, in
his is called a consumption tax. On the economic superiority of consumptions taxes, see N.
Taxation in Theory and Practice,” Journal of Economic Perspectives,
org/doi/pdfplus/10.1257/jep.23.4.147 (accessed March
ncome and Consumption Taxes: A Primer,” NBER Working Paper No. 12307, June
es/working_papers/w12307/w12307.pdf (accessed
oom eld, eds., he Consumption Tax: A Better Alternative?

ion, “Simplifying the Tax System: The History of the Flat Tax,” March
ax-system-history-flat-tax (accessed March 20, 2023).

ive Tax Plans with Equivalent Economic Results,” Heritage
ttos://www.heritage.org/taxes/report/|
s. Consumption tax plans generally include carveouts that exempt very

ity.

nomic Co-opera

httos://www.her

raise-taxes; David Burton, “How the OECD is
Suppression of Political Dissidents,” J
org/taxes/commentary/how-the-oecd-prom

uly 15, 2016, Heritage Fo

Promoting More

oting-more-iden

— 712 —

e Code (26

g the corporate income tax in
m that taxes labor and capital-factor incomes equally—

ied dividends tax is $12.30, which leaves $69.70, for an effective marginal tax rate of 30 percent. This, of

ic Law 115-97, § 11061, amending Internal Revenue Code $ 2010(c). The amounts
s are $5 million and $10 million, respectively. See also Internal Revenue Service,
Tax, Basic Exclusion Amount for Year of Death,” https://www.irs.gov/businesses/

ax (accessed March 22, 2023).
ould remain equal to the tax rate on global

U.S. Code § 67). Business deductions
ated to depreciation) should also be extended.
inment expense deductions. The 2017 tax bill’s

losses should be made permanent. The Pease

ould be maintained.

care consumers skin in the game.
ion on

giving health
s could gradually phase down the limita

0 a destination-based

nance literature,
Gregory Mankiw
0. 4 (2009), pp.
: Alan J. Auerbach,
2006,
arch 19, 2023); and
Cambridge, MA:

the modern public fi

Vol. 23,
9, 2023

, 2019, https://www.

Foundation
ive-tax-

our-conserva

s Edwards, Global Tax Revolution: The Rise of Tax Competition and the Battle to
nstitute, 2008); Preston Bra
of Government,” March 17, 2022, https://www.heritage.org/

shers, “Like Constitutional Checks and Balances,

(accessed

ion and Development (OECD): What America
rch 16, 2021, https://www.heritage.org/

Identity Theft, Crime, Industrial Espionage, and
undation Commentary, https://www.heritage.
tity-theft-crime-industrial-espionage-and;

33.
34,

35.

36.
37.

38.

39.

AQ.
Al.

42.

43.

44.

AS.

46.
47.

48.

David R

2025 Presidential Transition Project

. Burton “Towards a Global Tax Cartel?” Policy, Vol. 18, No. 4 (Summer 2002-2003), Center for

Independent Studies (Australia), httos://www.cis.org.au/wp-content/uploads/2015/04/images/stories/policy-
magazine/2002-summer/2002-18-4-david-r-burton.pdf (accessed March 19, 2023).

Roberts

et al., “Organization for Economic Co-operation and Development (OECD).”

See Inflation Reduction Act, $ 10301. See also Preston Brashers, “IRS and Allies Downplay 87,000-Person
Hiring Binge,” The Daily Signal, August 12, 2022, https://www.dailysignal.com/2022/08/12/the-irs-and-its-
allies-downplay-87000-person-hiring-binge/ (accessed March 19, 2023).

U.S. Department of the Treasury, General Explanations of the Administration’s Fiscal Year 2022 Revenue
Proposals, May 2021, pp. 88-89, https://home.treasury.gov/system/files/131/General-Explanations-FY2022.pdf
(accessed March 19. 2023).

See US.
U.S. House of Representatives, Committee on Oversight and Reform, Policy and Supporting Positions,
December 2020 (the “plumb book”), p. 127 https://www.govinfo.gov/content/pkg/GPO-PLUMBOOK-2020/
pdf/GPO-PLUMBOOK-2020.pdf (accessed March 19, 2023).

nternal

7803(a)
For a su

estimo

Department of the Treasury, Fiscal Year 2022-2026 Strategic Plan.

Revenue Service, “Organization and Top Officials,” https://www.irs.gov/pub/newsroom/marketing/

internet/irs-organization-chart.pdf (accessed March 19, 2023). See also Internal Revenue Code (26 U.S. Code §

~(b)).
mmary of various GAO reports on various IRS IT problems, see Vijay A. D’Souza, “Information

Technology: IRS Needs to Address Operational Challenges and Opportunities to Improve Management,”

ny before the Subcommittee on Government Operations, Committee on Oversight and Reform,

U.S. House of Representatives, October 7, 2020, GAO-21-178T, https://\www.gao.gov/assets/gao-21-178t.

pdf (accessed March 19, 2023). Charles O. Rossotti was named IRS Commissioner by President Bill Clinton

primaril

y so that Rossotti could address widely acknowledged IT issues. He made some improvements

between 1997 and 2002, but despite large investments, he did not really resolve the IT problems at the IRS.

nternal
See, for

Restruc
Law 114

nterna

Scott A.

Organiz

Since that time, the problems have worsened.
D'Souza, “Information Technology,” figure 1, p. 5.

Revenue Service, /RS Integrated Modernization Business Plan, April 2019, https://www.irs.gov/pub/

irs-pdf/p5336.odf (accessed March 20, 2023).

example, the Omnibus Taxpayers’ Bill of Rights, Public Law 100-647, Subtitle J of Title VI of

he Technical and Miscellaneous Revenue Act of 1988; Taxpayer Bill of Rights 2, Public Law 104-168; IRS

uring and Reform Act of 1998, Public Law 105-206, Title Ill; Consolidated Appropriations Act, Public
-]13, Title IV, Subtitle A (adding Internal Revenue Code § 7803(a)(3) and other changes); and Taxpayer
, Public Law 116-25, Title I.

of 68 proposed reforms, see National Taxpayer Advocate, 2022 Purple Book: Compilation of

ps://www.taxpayeradvocate irs.gov/wp-content/uploads/2022/01/ARC21_ PurpleBook.pdf (accessed

arch 19, 2023). Most, though not all, of these proposals have merit. Regarding penalty reform, see Jeremiah
, “Achieving Meaningful Civil Tax Penalty Reform and Making It Stick,” Akron Tax Journal, Vol. 27 (2012),
ideaexchange.uakron.edu/cgi/viewcontent.cgi?article=1153&context=akrontaxjournal (accessed

arch 19, 2023).

Revenue Service, 2023 Congressional Budget Justification & Annual Performance Report and

Plan, Rev. 3-2022, https://home.treasury.gov/system/files/266/Internal-Revenue-Service-FY-2023-CJ.pdf
(accessed March 19, 2023).

Revenue Service, 2027 IRS Data Book: October 1, 2020 to September 30, 2021, table 11, p. 26, https://

www.irs.gov/pub/irs-pdf/o55b.pdf (accessed March 19, 2023).
bid., 2027 IRS Data Book, table 2, p. 4.

Hodge, “The Compliance Costs of IRS Regulations, Tax Foundation Fiscal Fact No. 512, June 2016

https://files.taxfoundation.org/legacy/docs/TaxFoundation_FF512.pdf (accessed March 19, 2023).

ation for Economic Cooperation, he Multilateral Convention on Mutual Administrative Assistance

in Tax Matters: Amended by the 2010 Protocol, https://read.oecd-ilibrary.org/taxation/the-multilateral-
convention-on-mutual-administrative-assistance-in-tax-matters_9789264115606-en#pagel (accessed
March 20, 2023).

— 713 —

49.

50.

ill

52.
53.

54.

52:

56.

58.

59.

60.

61.

62.
63.

64.

65.
66.

Mandate for Leadership: The Conservative Promise

David Burton, “Two Litt
Suppression of Political
21, 2015 file:///C:/Users/
of the
issues/internationa
d-pena

ationa
ury.gov/sites/defau

Espionage, and

U.S. Departmen
gov/policy-
enforcemen
John S. McCai
home.treas'
2018-FIRR

Dodd-Fran
Peter J. Wa

1
QD
—

n
A_O.pdf (a
ison, “Title

government-regulatio

orbert J.

Foundation
consumer-protection-
Paul Kupiec, “Title II: Is
Against Dodd-Frank.

orbert J. Michel, “Mo

2017), https://www.her!
solutions%20to,and%2
Federal
www.fh
arch 20, 2023).

iles/266/13.-FinCEN-F

arch 19, 2023).

David R. Burton
Backgrounder

com/2016/BG3157.pdf.
bid., table 2, p. 11
A recent report
Bank Policy Ins
BSA/AML & San
BP|_AML_Sanc

itute, “
ctions

Wall Stree

n/report/th
g the Dodd-Frank Derivatives Mess: Repealing
ed., The Case Against Dodd-Frank: How the “Consumer Protection” Law Endangers Americans, Heritage
, https://www.heritage.org/government-regulation/report/t

ichel, “Fixin

ney and Banking Provisions i
Direction,” in Prosperity Unleashed: Smarter Financial Regulation (Was
ed#:~:text=Smar
Oaccountable%20than%20ever%20before.

Housing Finance Agency, “Single Security Initiative and Com

fa.gov/PolicyProgramsResearch/Policy/Pages/Securitization

Financial Crimes Enforcement Network, “Suspicious Ac
gov/reports/sar-stats (accessed March 19, 2023).

and Norbert J. Michel, “Financial Privacy in a Free Society,” Heritage Foundation
0. 3157, September 23, 2016, table 1, p.

showed that just 14 surveyed financial ins

Dissidents,” Heri
DRBar/Downloads/BG3087-3.pdf.
Treasury, “CFIUS Enforcement an
/the-com
ty-guidelines (accessed March 20,
Defense

ccessed March 20, 2023).

and the

aw-endangers.
Orderly Liquidation Authori

n the F

itage.org/prosperity-unleash

Y-2023-CJ.pdf (accessed March 19,

Getting
Complia

o Effectiveness: Report on

ions. Study_vF.odf (accessed March 19, 2

Burton and Mich
he Bank Secrecy Act
2022 , https://www.ca
Levi and Peter Reuter,
ariano-Florentino Cu
he Disruption of Crim
https://scholarlycomm
arch 19, 2023).

el, “Financial Privacy in a Free Society;”
Privacy and Deter Criminals,” Cato Instit

0 Protec
0.0rg/sites/cato.org/files/2022-07/'

“Money Laundering,” Crime and Justice: A Revie

y Necessary to Fix ‘7

d Penalty Guidelines,” ht
mittee-on-foreign-investment-in-the-un

2023).

inancial CH

e Known Tax Treaties Will Lead to Substantially More Identity Theft, Crime, Industrial
age Foundation Backgrounder No. 3087, December

ps://home.treasury.
ited-states-cfius/cfius-

Authorization Act for Fiscal Year 2019, Public Law 115-232. Title XVII, https://
iles/2018-08/The-Foreign-Investment-Risk-Revi

ew-Modernization-Act-of-

Reform and Consumer Protection Act, Public Law 111-203.

Financial Stability Oversight Council,” in Norbert Michel, ed., The Case
Against Dodd-Frank: How the “Consumer Protection” Law Endangers Americans, https://www.heritage.org/
e-case-against-dodd-frank-how-the-consumer-protection-law-endangers.
Titles Vil and VIII,” in Norbert Michel,

he-case-against-dodd-frank-how-the-

[00 Big to Fail’?” in Michel, 7he Case

OICE Act: A Major Step in the Right

2023).

itutions spen
U.S. Financia

023).
orbert J. Mich

PA_932_2.pd

ps://home.

hington, DC: The Heritage Foundation,
er%2O0financial%20regulations%3A%20

mon Securitization Platform,” https://
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ure.aspx (accessed

U.S. Department of the Treasury, Financial Crimes Enforcement Network, Congressional Budget Justification
and Annual Performance Plan and Report, FY 2023, Table 11, p. 3, ht

reasury.gov/system/

See Financial Crimes Enforcement Network, “Annual Report,” https:/Awww.fincen.gov/annual-report (accessed

ivity Report Statistics (SAR Stats),” httos://www.fincen.

O, http://thf-reports.s3.amazonaws.

2.4 billion on AML/CFT compliance.
Institution Resources Devoted to

nce,” October 29, 2018, p. 4, https://bpi.com/wp-content/uploads/2018/10/

el and Jennifer J. Schulp, “Revising
ute Policy Analysis No. 932, July 26,

accessed March 19, 2023); Michael

ellar, “The Tenuous Relationship be

ween the Fig

of Research, Vol. 34 (2006); and

ht Against Money Laundering and

inal Finance,” Journal of Criminal Law and Criminology, Vol. 93, No. 2 (Winter 2003)

ons.law.northwestern.edu/cgi/viewcontent.cgi?ar

This data, as well as A
Department of Justice

This would be in cooperation with the IRS because Form 8300 is a joint

icle=7123&context=jclc (accessed

RS-FINCEN endeavor.

L-CFT convictions, would published be in cooperation with the U.S.

—714—

67.

68.

69.
70.
71.
72.
TS.

74,

Loe

76.

2025 Presidential Transition Project

On banks, credit unions, broker-dealers, and other financial insti
a)(2) also defines “financial institutions” to include money service businesses; insurance

31 U.S. Code 85312

utions as normally understood, but note that

companies; jewelers; pawnbrokers; travel agencies; dealers in automobiles, airplanes, and boats; persons

Burton comment, ibid.

Federal Register, Vol. 87, No.
U.S. Department o
bid.

application/pdf/english_paris_agreemen
United Nations, “United Nations Framewo
int/resource/docs/convkp/conveng.pdf (a
“What Is ESG?” ESG Hurts, https://esghur
Business Should Dispense wi

RI Association, “What are the Principles

h ESG,” American Insti

rk Conven

what-are-the-principles-for-responsible-i

Art. 9, November 14, 2016, https://d8q8tl3

involved in real estate closings and settlements; casinos; and telegraph companies.
David R. Burton, “The Corporate Transparency Act and the ILL
Backgrounder No. 3449, November 7, 2019, https://www.heritage.org/sites/default/files/2019-11/BG3449_ 0.

pdf, and David R. Burton to AnnaLou Tirol, Financial Crimes Enforcement Network, “Re: Beneficial Ownership
nformation Reporting Requirements,” Comment, May 5, 2021
Regulatory_Comments/FINCEN-2021-0005-0132_attachment_

CIT CASH Act,” Heritage Foundation

http://thf_media.s3.amazonaws.com/2022/
df (accessed March 19, 2023).

89, September 30, 2022, pp. 59498-59596.
the Treasury, Fiscal Year 2022-2026 Strategic Plan.

United Nations, “Paris Agreement,” 2015, https://unfccc.int/files/essential_ background/convention/

.pdf (accessed March 20, 2023).

ion on Climate Change,” GE.5-62220, 1992, https://unfccc.
ccessed March 20, 2023).

s.com/ (accessed March 22, 2023), and Samuel Gregg, “Why

tute for Economic Research, December 4, 2022, https://
www.aier.org/article/why-business-should-dispense-with-esg/ (accessed March 22, 2023).

or Responsible Investment?” https://www.unpri.org/about-us/
nvestment (accessed March 22, 2023). The PRI Association is a U.N.-
affiliated non-governmental organization. See also PRI Association, “Articles of Association of PRI Association,”

e9vf20.cloudfront.net/Uploads/g/e/r/2016-11-14-Articles-of-
Association-of-PRI-Association-.pdf (accessed March 22, 2023).

— 715 —

EXPORT-IMPORT BANK

THE EXPORT-IMPORT BANK SHOULD BE ABOLISHED
Veronique de Rugy

he Export-Import Bank of the United States (EXIM or the Bank) is a federal

agency that was established in 1934 to provide export subsidies through tax-
payer-backed financing to private exporting corporations, as well as to foreign
companies buying U.S. exports, with the ostensible purpose of promoting American
exports, creating jobs, supporting small businesses, improving U.S. competitive-
ness, and protecting U.S. taxpayers.

In 1986, David Stockman, who served as Director of the Office of Management

and Budget under President Ronald Reagan, wrote that:

Export subsidies are a mercantilist illusion, based on the illogical proposition
that a nation can raise its employment and GNP by giving away its goods for
less than what it costs to make them.... Export subsidies subtract from GNP
and jobs, not expand them.... Moreover, in 1981, the EXIM’s practice was to
bestow about two thirds of its subsidies on a handful of giant manufacturers,
including Boeing aircraft, General Electric, and Westinghouse.’

Since then, very little has changed. EXIM operates in effect as a protectionist
agency that picks winners and losers in the market by providing political privi-
leges to firms that are already well-financed. By doing so, it risks taxpayer funds
as it stymies economic growth. This reality is not altered by the argument that the
Bank could be a weapon to fight China—an argument that rests on a misguided

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understanding of what competitiveness is and how it is achieved and maintained.
The Bank should be abolished.

BACKGROUND

The Export-Import Bank was created in 1934 as an export credit agency (ECA)
to finance trade with the Soviet Union. It was reorganized as an independent gov-
ernment agency in 1945. President Franklin Roosevelt’s Executive Order 6581
gave it “the power to aid in financing and to facilitate exports and imports and
the exchange of commodities between the United States and other Nations or the
agencies and nationals thereof” to create jobs in the United States.”

EXIM has four main tools with which to pursue these goals: loan guarantees,
working capital guarantees, direct loans, and export-credit insurance. Importantly,
for four years starting at the end of 2015, the Bank became incapacitated. Lacking
a quorum for its board of directors, it could not extend financing that exceeded $10
million per project. That put an end to about 85 percent of the Bank’s financing
obligations. As the numbers below show, the Bank hasn’t yet recovered from that
long interruption.

Total Bank authorizations in recent years have gone from $12.6 billion in fiscal
year (FY) 2007° to $21.5 billion in FY 2014* to $5.2 billion in FY 2022.° A better
way to understand these numbers is to look at the amount of financial exposure
the Bank has—that is, the risk the Bank takes for which taxpayers are ultimately
responsible. During this same period, the Bank’s total exposure increased from
$57.42 billion in FY 2007° to $112.1 billion in FY 2014’ and then fell to $41.3 billion
in FY 20218 and $35.4 billion in FY 2022.°

CLAIMS VS. THE FACTS

Supporters of EXIM make many claims about the benefits that our nation and
citizens derive from having an Export Credit Agency. These claims, however, are
not supported by the facts.

The Bank is an example of government-granted privilege. Traditionally,
one of EXIM’s top 10 domestic beneficiaries is Boeing, which at a40 percent share
of total loan authorizations dwarfs the 25 percent share for all small businesses that
received EXIM’s services combined.” On the foreign side, things are not much dif-
ferent: The subsidized financing largely benefits very large companies like Mexico’s
Pemex, Ireland’s Ryanair, and Emirates Airlines that either collect massive subsi-
dies as state-controlled entities or could easily access private financing." American
businesses that lack political connections are put at a competitive disadvantage by
their own government because they are forced to compete against both domestic
and foreign businesses that enjoy access to subsidized loans.”

The Bank does not maintain or create jobs. EXIM’s supporters point to the
numbers of new jobs that they claim have been created through federal spending,

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but the unseen effects are ignored. For example, funding for one industry or firm
might take more jobs away from other industries and firms, resulting in a net job
loss even though jobs are created for the financed firm. At best, it could be said that
the Bank redistributes employment from unsubsidized firms to subsidized firms.

However, with very rare exceptions, most exports financed by EXIM would
have taken place without government support. Many companies have said so
themselves;'’ the procurement happens before the decision to get government
support; and, as noted above, most EXIM deals go to large companies with easy
access to capital. Thus, the agency is taking credit for jobs that would have existed
in any event.

The Bank does not promote exports. EXIM presidents commonly claim
that the agency’s mission is to support U.S. jobs by facilitating American exports
through its export-financing tools. However, trade economists have long known
that export credit subsidies merely redistribute exporting opportunities to subsi-
dized firms instead of increasing the net number of exports—something that also
slows economic growth."*

Even more telling is the performance of the U.S. economy and American exports
during the four years when EXIM lacked a board quorum (2015-2019) and was
barred from finalizing deals in excess of $10 million. During that time, EXIM autho-
rizations fell from $21 billion in FY 2014 to $3.6 billion in FY 2018 (adjusted for
inflation).'* However, also during that time, regular big-ticket EXIM beneficiaries
continued to benefit from their easy access to capital markets and still had the
ability to finance their export activities.

Further, U.S. exports were utterly unaffected by the reductions in the Bank’s
activities.’° U.S. unemployment fell to a level not seen in halfa century, but exports
soared with financing provided by commercial lenders. The only negative eco-
nomic impact from EXIM’s lack of a board quorum was its effect on the Bank
itself. This contradicts EXIM’s claim that its activities are crucial for the success
of U.S. exporters and economic growth. Instead, it shows that economic growth
is the best booster of U.S. exports and job creation and that it does not depend on
EXIM subsidies.

Subsidy-boosted exports do not boost economic growth. EXIM’s primary
reason for existing is to increase exports, as if more exports themselves represent
more jobs and economic growth. Recent expressions of this fallacious belief can be
found in a book by former EXIM President Fred Hochberg. According to Hochberg,

“We know that trade, and exports in particular, can have a big impact on jobs.”””
While this is acommon misconception about exports, it is one worth correcting.
As trade economists know, exports are a cost to the economy: They subtract from
GDP. Imports, on the other hand, add to GDP. If the U.S. could acquire all of the
imports that it currently gets without exporting anything in exchange, that would
be the best of all worlds. Unfortunately, one reason that foreigners are so eager

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to sell us their goods is that they want our dollars to buy our debt, invest in the
country, and buy our exports. That is why exports drop when overall imports drop.

Exports promote U.S. economic growth only if the value of the resources used to
produce them is less than the value of what we receive as imports in exchange for
those exports. By subsidizing American exports, EXIM causes too many resources
to be devoted to producing exports. As a result, the total value of our exports is
made larger than it would otherwise be to obtain any given amount of imports.
In other words, EXIM thus compels American taxpayers to subsidize foreigners’
standards of living at no appreciable benefit to the US.

Unfortunately, this misunderstanding and the constant glamorization of
exports and their impact on jobs and growth are used to justify government sup-
port for some exports (on average, 98 percent of exports are not backed by EXIM
financing). It also is extremely unfair. Because capital will tend to shift from unsub-
sidized companies to subsidized companies (taxpayers foot the bill if companies
backed by the Bank default), unsubsidized export companies face higher borrowing
costs, which could translate into fewer jobs in unsubsidized companies or lower
pay for their workers.

The Bank does not promote growth by leveling the playing field. EXIM’s
charter stipulates that one of its missions is to support U.S. exports with the goal
of creating jobs and promoting economic growth through the provision of export
financing via its loan-guarantee and insurance programs. In particular, EXIM is
to intervene in cases “where such support is necessary to level the competitive
playing field for U.S. exporters due to financing provided by foreign governments
to their exporters.”'®

As aresult, EXIM for years has been focused primarily on what other countries’
ECAs are doing and how much financing they are providing.” A reading of any of
EXIM’s Competitiveness Reports shows that the Bank frames the “competitive-
ness” of the U.S. economy and exporters in extremely narrow terms—specifically,
as the amount of business that foreign ECAs are doing relative to EXIM.

The report for 2020 features striking evidence of this mindset. For instance,
lamenting the “nearly four-year hiatus” during which the Bank lacked a board
quorum to approve large deals, EXIM’s leadership maintains that these years

“severely hindered EXIM’s ability to support the competitiveness of U.S. export-
ers.” During that time, foreign ECAs “fundamentally evolved their philosophy and
substantively expanded their roles,” and “the United States must work hard to keep
pace.” The Bank goes on to promise that it will “re-emerge from the years of being
out of the long-term export finance business and restore its standing as one of the
world’s most competitive ECAs.””°

In other words, EXIM bureaucrats appear to believe that economic growth
and jobs result not from a favorable tax and regulatory environment, but froma
victory in hand-to-hand subsidy combat between government banks. The Bank’s

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Competitiveness Reports include a table that ranks countries by ECA financing
volume. An adjacent map displays the most “competitive” ECAs around the world,
implying that the U.S., which ranked eighth in terms of volume in 2019 (the year
before the pandemic), is losing ground compared to more “hyperactive” (ranked
higher) ECAs.”! The implication is that ECA export financing improves the overall
health of the export market and thereby fuels economic and job growth—which
it does not do.

e Consider Italy’s hyperactive ECA. In 2019, Italy was ranked first among
Organisation for Economic Co-operation and Development (OECD)
countries in terms of volume and was highlighted in the report as an example
for other countries to follow. Yet the Italian ECA’s hyperactivity appears to
have had little impact on that country’s economic growth or employment.

e Germany was the second-highest ranked OECD country on this list in 2019.
While Germany had respectable economic growth at the time of the report,
only 0.7 percent of its exports were backed by ECA financing. These data
provide little support for the argument that Germany’s strong economic
performance has much, if anything, to do with the German ECA.

e China by all accounts had a hyperactive ECA: It ranked first on the list in
2019. ECA-backed exports in China represented 2.1 percent of exports
backed by government financing. Whatever one perceives as China’s
economic successes, it is hard to argue that the main driver of China’s
exports is its ECA.

e The report highlights the eighth-ranked U.S. for its unusually low level
of EXIM-backed exports. At the time of the report, the U.S. economy
was thriving, wages and employment were up, and the country still had
flourishing trade—but it was also striving when EXIM was mostly dormant.
In other words, one cannot argue that the bustling economy was the result
of EXIM support.

Even in countries touted as leaders in relying on ECA financing, ECA-backed
exports are never more than 4.7 percent of total exports. Moreover, even that is
an outlier. For 23 of the 28 countries on this list Gncluding both China and the
U.S.), the share of exports backed by ECA financing is less than 2 percent. This
fact suggests that—contrary to the claims of EXIM’s advocates—ECA financing is
irrelevant to the overall health of the export market as well as to economic growth.
This is consistent with what economists know about the impact of subsidies on
economic growth.

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The Bank does not support small businesses. Most of the Bank’s funding
goes to large corporations such as Boeing—a recipient of 68 percent of EXIM’s
loan guarantees and 30 percent of EXIM’s overall activities.” Over the years, 10
large domestic corporations have received roughly 65 percent of the Bank’s total
assistance (it is closer to 70 percent today). More than 99.9 percent of U.S. small
businesses receive no benefits from EXIM and are often placed at a competitive
disadvantage by the subsidies doled out to larger competitors. In fact, the Bank’s
support for small businesses has declined from $2.3 billion in FY 2019” to “more
than $2.0 billion” in FY 2020” to only $1.6 billion in FY 2021.” This decline
occurred amid a pandemic that hit small businesses especially hard, and it con-
tinues today.

The Bank is not a good deal for taxpayers. The Bank’s accounting practices
are deficient, and the Bank miscalculates its budget savings. While it claims that
its operations will save taxpayers $14 billion over the next decade, the Congres-
sional Budget Office has found that EXIM programs will actually cost taxpayers
$2 billion.2° Numerous audits done by the Bank’s internal inspector general
also show that the Bank’s risk analyses, default assumptions, internal reporting
procedures, and financial reporting practices are not reliable enough to ensure
the safe stewardship of taxpayer funds and responsible management of EXIM’s
vast portfolio.””

FAILING TO MEET THE CHINA CHALLENGE

These days, to get whatever expansion of government one wants or to jus-
tify anew government activity, one has only to declare that more government
intervention is needed to help fight China. President Trump used this argument
to secure reauthorization of EXIM in 2019. Today, President Biden argues that
the Bank could be a powerful weapon in the government’s geoeconomic arsenal
against China.

The rationale is that this will prevent China from dominating the global market
with its subsidies and will boost American jobs and manufacturing. The prob-
lem is that cynics who support such policies make no effort to adopt a serious
strategic plan to achieve this goal. For instance, how can EXIM help us to fight
China while state-owned Chinese companies like China Air have been some of the
companies most subsidized by EXIM?” Furthermore, it has now been four years
since Congress instructed EXIM to focus on China, but there has been no funda-
mental change in the way EXIM operates or the companies to which it extends
taxpayer-backed financing: Deals related to the aircraft industry still dominate
the Bank’s portfolio.

In addition, there is no evidence that EXIM has altered its intense focus on
competing with other governments’ ECAs. If the Bank were serious about com-
peting against China, it would be targeting the low-income markets where China

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has been making its most important investments. Instead, its obsession with other
ECAs has caused EXIM to direct the vast majority of its funding to large foreign
companies in higher-income nations. Data available on the OECD website show
that the level of ECA financing in high-income countries in 2019 was more than
double the amount in low-income countries.”’ The same was true for previous years.
In other words, EXIM and the ECAs of the OECD are competing in markets where
commercial lending is abundant—a trend that continues today.

The failure to deliver on its congressionally imposed obligation—however mis-
guided that obligation may be—is also noticeable in the fact that EXIM’s China
and Transformation Exports Program (CTEP) extended only $141.3 million in
financing in FY 2022—a fraction of the $27 billion it is supposed to deliver by the
end of 2026.*° The Bank’s efforts have also included a misplaced focus on emerging
technologies such as quantum computing and artificial intelligence, which do not
need EXIM financing because their foreign sales attract commercial financing
without government support. The lack of demand for EXIM products could also
be reflected in the Bank’s authorization of $5.2 billion in loan guarantees and sup-
port in FY 2022,*! down from its FY 2012 peak of “over $35.7 billion” during the
Obama Administration.”

This lack of activity also extends to the semiconductor industry, which has been
picked as a focal point for a governmentwide industrial policy effort to counter
China’s ambition to dominate that industry. Ironically, at the same time that some
want to become more like China to fight China, China’s leaders are realizing that
their heavy-handed semiconductor subsidies are weakening the Chinese economy.
According to Bloomberg News:

Top [Chinese] officials are discussing ways to move away from costly
subsidies that have so far borne little fruit and encouraged both graft and
American sanctions, people familiar with the matter said. While some
continue to push for incentives of as much as 1 trillion yuan ($US145 billion),
other policymakers have lost their taste for an investment-led approach that’s
not yielded the results anticipated, the people said.**

This development is not surprising to those who understand basic economics.
The goal of using EXIM as a weapon against China was a bad idea in the first place.
Even if it were a good idea, for it to succeed would have required that EXIM stop
serving the clients it has been serving for decades. That has not happened, and it
will not happen.

CONCLUSION

The Export-Import Bank should be abolished because it wastes taxpayer money,
adversely affects American businesses, and does not promote economic growth

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Mandate for Leadership: The Conservative Promise

effectively. Furthermore, any attempts to reorient the agency and make it a weapon
with which to fight against China are going to fail. Economic fights and national
security fights are not won with subsidies.

THE CASE FOR THE EXPORT-IMPORT BANK
Jennifer Hazelton

n 1986, President Ronald Reagan signed a bill extending the charter of the

Export-Import Bank (EXIM) by an additional six years. Ina signing statement
attached to the bill, the President declared that “[t]his sends an important signal
to both our exporting community and foreign suppliers that American exporters
will continue to be able to compete vigorously for business throughout the world.”**

As acandidate for President, Ronald Reagan was opposed to EXIM, but as Pres-
ident, he learned the challenges America’s businesses face when competing for
opportunities overseas, and his position on EXIM evolved. As President Reagan
once famously remarked, “Why would I want our businesses competing with two
hands tied behind their backs?” On January 30, 1984, the President said, “Exports
create and sustain jobs for millions of American workers and contribute to the
growth and strength of the United States economy. The Export-Import Bank con-
tributes in a significant way to our nation’s export sales.”

President Reagan was exactly right. EXIM provides a mechanism that American
companies can use to vie for projects that would otherwise be out of reach, notably
deals that the banking industry won’t finance because of the risk associated with
the host country or because the host nation itself requires a sovereign guarantee
in order to submit a bid. EXIM is the only American vehicle that can provide that
sovereign guarantee.

Since Reagan’s presidency, the global economic order has shifted dramatically,
and arising China has completely disrupted the export credit sector.

e In Reagan’s era, export credit financing was a means for nations to compete
for and win projects overseas in order to create more jobs at home. It was a
benign tool for economic expansion. China, however, has morphed export
credit financing into a weapon of national security.

e Where most nations have just one export credit agency (ECA), China
has three, all targeted for specific stages of economic and industrial
development. The amount of money China has put behind these three
instruments is staggering.

e = Itis estimated that in 2018, China provided more than $500 billion in export

credit, approaching in that one year the total amount of financing EXIM has
provided in its 90-year history.

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2025 Presidential Transition Project

e China’s export credit activity is greater than that of the ECAs of the
entire G7 combined. Today, China is the world’s largest official creditor,
maintaining a portfolio more than twice the size of the World Bank and
International Monetary Fund combined.

e China’s highly aggressive Belt and Road Initiative, which has prompted
international criticism for ensnaring the developing world in “debt-trap
diplomacy,” has created a sphere of economic and strategic influence that
includes about 150 countries, rivaling the relationships of the United States
and her allies.

Unlike America and the G7 economies, China does not subscribe to the rules-
based order that has governed export credit financing for nearly a century. As in
so many other things, China plays by its own rules and is opaque in how it operates,
weaponizing its export credit financing deals by offering developing nations terms
that are often “too good to be true.” Once the project is underway, the Chinese have
been known to change the terms, making a project unaffordable for the purchasing
country. These tactics have yielded China important strategic plunder like mines
and critical minerals, satellites, and even ports like those in Hambantota, Sri Lanka,
and Mombasa, Kenya.

Export credit is a strategic weapon in China’s whole-of-government approach
to enhance its global power, economic might, and national security. The only
country that has the economic heft to counter China’s aggressions in export credit
financing is the United States. Not only do American companies risk losing out to
Chinese competitors for international opportunities if EXIM is not there to offer
support, but a United States without a functioning export credit agency also leaves
an unchecked China with a wide-open field to claim jurisdiction over swaths of
ocean and shipping lanes, expand its economic influence, and create major changes
in the global balance of power.

In response to Chinese aggression in export credit, the ECAs of other coun-
tries have reacted defensively to change their policies and programs to avoid
losing access to large chunks of global markets. Many countries, including strong
US. allies like the United Kingdom, Canada, Japan, and Italy, have changed the
mission of their ECAs from one of leveling the playing field for their exporters
to hunting proactively for transactions for their businesses and advancing their
national strategic interests over the long term. In addition, foreign buyers, par-
ticularly those looking to build large international projects, have been indicating
that the availability of government-backed financing is a core component of their
evaluation of bids and identification of sourcing. Allied nations have taken steps
like lowering their content requirements in order to lure more deals, often at
U.S. expense.

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Mandate for Leadership: The Conservative Promise

Meanwhile, U.S. content requirements have remained constant, and the United
States continues to abide by traditional Organisation for Economic Cooperation
and Development (OECD) rules. For example:

e The United Kingdom offered Boeing financing backed by Britain’s ECA if
Boeing would put Rolls Royce engines on its jets instead of GE engines.

e Italy’s ECA offered General Electric export credit financing in exchange for
moving the production of some of its turbine components from the United
States to Italy.

China’s tactics, as well as those of some of America’s allies, have been success-
ful in drawing manufacturing and the jobs associated with that production away
from US. soil. EXIM’s 2018 Competitiveness Report accurately documents how
extensively foreign ECAs have expanded programs aimed at embedding their small
and medium-sized exporters into the global supply chain to the detriment of U.S.
exporters, particularly small businesses.*° To ignore these changes and leave the
United States without its own export financing weapon is to resign the United
States to a reduced role in world geopolitical affairs and accept fewer jobs and
lower standards of living for many Americans.

Critics of EXIM employ a host of defamatory slurs like “crony capitalism” and

“Bank of Boeing.” The “Bank of Boeing” moniker is particularly misleading, as it
was born in the wake of the 2008 financial crisis when the airline industry was par-
ticularly hard hit and private-sector financing was not available for many airlines
looking to purchase Boeing aircraft. EXIM’s portfolio tends to be cyclical with
different industries relying on export credit financing at different points in time,
depending on economic conditions.

The truth is that EXIM provides financing only when the private sector will not
or cannot (a concept known as additionality). In addition:

e When EXIM does provide financing, usually in the form of a loan or loan
guarantee, the borrower pays interest rates that are driven by the market.

e EXIM does not undercut the private sector. It does not solicit any
applications for financing, and all applications are judged on the merits of
the transactions.

e All transactions must have “reasonable assurance of repayment,” which

is why EXIM has an exceptionally low default rate, historically hovering
around 0.5 percent—a default rate that is the envy of private banking.

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2025 Presidential Transition Project

When EXIM enters a deal, the American taxpayer is always protected

first. If a deal goes into default, the U.S. taxpayer is paid back before any
other lender.

e Borrowers are loathe to default on the United States of America.

This ability to manage risk successfully is why EXIM actually makes a profit
for American taxpayers, described in government parlance as “negative subsidy,”
sending more than $9 billion to the U.S. Treasury for debt reduction since 1992.
The bank has also supported hundreds of thousands of U.S. jobs, most of them in
manufacturing, during the past decade.

Export credit financing has become a critical lever for macroeconomic growth
for many countries, allies and competitors of the U.S. alike. Other nations are using
ECAs strategically to influence decisions and procure economic opportunities,
hindering the participation of U.S. firms and costing American jobs, particularly
in manufacturing.

China’s aggressive actions in export finance bleed beyond economic advance-
ment and are clearly an effort to expand both its national security and its global
power. The United States would be foolish to abandon this field of play, surren-

dering it to China and other nations, and to relinquish EXIM as a powerful tool in
America’s asymmetrical warfare toolbox.

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Mandate for Leadership: The Conservative Promise

ENDNOTES

1. — David A. Stockman, The Triumph of Politics: Why the Reagan Revolution Failed (New York: Harper & Row,
986), pp. 113-114.

2. — President Franklin D. Roosevelt, “Executive Order 6581 Creating the Export-Import Bank of Washington,”
February 2, 1934, https://www.presidency.ucsb.edu/documents/executive-order-6581-creating-the-
export-import-bank-washington#:-:text=Executive%200rder%206581%20Creating%20The%20Export-
mport%20Bank%20of,by%20promoting%20the%20fullest%20possible%20utilization%200f%20 (accessed
February 23, 2023).
3. Export-Import Bank of the United States, Annual Report 2007, p. 14, https://img.exim.gov/s3fs-public/
O7.pdf (accessed March 21, 2023).

managed-documents/ar20

4. — Export-Import Bank of the United States, Annual Report 2074, pp. 84 and 86, https://img.exim.gov/s3fs-
public/reports/annual/EXIM-2014-AR.pdf (accessed March 21, 2023).

5. Export-Import Bank of the United States, Annual Management Report for the Year-Ended September 30,

m
2022, and September 30, 202], pp. 1 and 7, https://img.exim.gov/s3fs-public/reports/annual/2022/EXIM%20
FY22%20AMR%20Final_ SignOff_ 508 _v27_FINAL.pdf (accessed March 22, 2023).
6. — Export-Import Bank of the United States, Annual Report 2008, pp. 35 and 63, https://img.exim.gov/s3fs-
public/reports/annual/2008AnnualReport.odf (accessed March 22, 2023).
7. Export-Import Bank of the United States, Annual Report 20/5, pp. 28 and 42, https://img.exim.gov/s3fs-
public/reports/annual/EXIM-2015-AR.pdf (accessed March 22, 2023).
8. — Export-Import Bank of the United States, Annua/ Management Report for the Year-Ended September 30,
2022, and September 30, 202], pp. 1 and 18, https://img.exim.gov/s3fs-public/reports/annual/2022/EXIM%20
FY22%20AMR%20Final_ SignOff_ 508 _v27_FINAL.pdf (accessed March 22, 2023).
9. — Ibid.
10. Veronique de Rugy, “Export-Import Is Still Boeing’s Bank,” Mercatus Center at George Mason University Data
isualization, March 3, 2015, https:/Awww.mercatus.org/research/data-visualizations/export-import-still-
boeings-bank (accessed March 21, 2023).
11. Veronique de Ruay, “The Export-Bank: Winners and Losers of Government-Granted Privilege,” Testimony
before the Committee on Banking, Housing, and Urban Affairs, U.S. Senate, June 2, 2015, https://www.
mercatus.org/research/federal-testimonies/export-import-bank-winners-and-losers-government-granted-
privilege (accessed February 23, 2023).
12. Veronique de Rugy, Nita Ghei, and Michael Wilt, “Should the US Export-Import Bank Be Reauthorized?”
Mercatus Center at George Mason University Policy Brief, July 28, 2015, httos://www.mercatus.org/research/
policy-briefs/should-us-export-import-bank-be-reauthorized (accessed February 23, 2023).
13. Veronique de Rugy, “Emirates to Ex-Im Bank: We'll Be Just Fine Without You,” National Review, The Corner,
September 8, 2014, https://www.nationalreview.com/corner/emirates-ex-im-bank-well-be-just-fine-without-
you-veronique-de-rugy/ (accessed February 22, 2023).
14. Sallie James, “Time to X Out the Ex-Im Bank,” Cato Institute, Herbert A. Stieffel Center for Trade Policy, Trade
Policy Analysis No. 47, July 6, 2011, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1960016 (accessed
February 22, 2023), and Salim Furth, “Export-Import Bank: What the Scholarship Says,” Heritage Foundation
Backgrounder No. 2934, August 7, 2014, https://www.heritage.org/trade/report/the-export-import-bank-
what-the-scholarship-says.
15. Veronique de Rugy and Justin Leventhal, “Ex-lm Bank: A Comparative Analysis of Pre- and Post-Quorum
Lending,” Mercatus Center at George Mason University Policy Brief, April 23, 2019, pp. 1 and 2, https://www.
mercatus.org/research/policy-briefs/ex-im-bank-comparative-analysis-pre-and-post-quorum-lending
(accessed February 22, 2023).
16. Ibid., p. 5.
17. Fred P. Hochberg, Trade is Not a Four-Letter Word: How Six Everyday Products Make the Case for Trade (New
York: Simon & Schuster/Avid Reader Press, 2020), p. 71.
18. Export-Import Bank of the United States, Agency Management Report for the Years Ended
September 30, 2020, and September 30, 2019, pp. 2 and 4, https://img.exim.gov/s3fs-public/reports/
annual/2020/S508Compliant_EXIM%20Q4%20FY20%20AMR%20FINAL_Signoff_updated12.1.2020.pdf
(accessed February 22, 2023).

— 728 —

19.

20.

21.

22.

23.

24.

25.

26.

27.

28.

29.

30.

41.

32.

33.

2025 Presidential Transition Project

Veronique de Ruay, “Ex-Im Bank Competitiveness Doesn't Helo Export Competitiveness,” testimony before
the Ex-Im Bank Advisory Committee, September 30, 2021, https://www.mercatus.org/research/federal-
testimonies/ex-im-bank-competitiveness-doesnt-help-export-competitiveness (accessed February 22, 2023).
Export-Import Bank of the United States, Report to the U.S. Congress on Global Export Credit Competition
for the Period January 1, 2020 Through December 31, 2020, June 2021, p. 3, https://img.exim.gov/s3fs-public/
reports/competitiveness_reports/2020/EXIM_2020_CompetitivenessReport_Web-Ready_Single%20pages.
pdf (accessed February 23, 2023).

Export-Import Bank of the United States, Report to the U.S. Congress on Global Export Credit Competition
for the Period January 1, 2019 Through December 31, 2019, June 2020, p. 38, https://img.exim.gov/s3fs-
public/reports/competitiveness_reports/2019/2019-EXIM-Competitiveness-Report-FINAL.pdf (accessed
February 22, 2023).

De Rugy and Leventhal, “Ex-Im Bank: A Comparative Analysis of Pre- and Post-Quorum Lending,”

pp. 7 and 10.
Export-Import Bank of the United States, Keeping America Strong: Export-/mport Bank of the United States
2019 Annual Report, pp. 6 and 10, https://img.exim.gov/s3fs-public/reports/annual/2019/EXIM_2019%20
AnnualReport_508C_Web.pdf (accessed February 22, 2023).

Export-Import Bank of the United States, A// America: Export-/mport Bank of the United States 2020 Annual
Report, pp. 7 and 42, https://img.exim.gov/s3fs-public/reports/competitiveness_reports/2019/2019-EX|M-
Competitiveness-Report-FINAL.pdf (accessed February 22, 2023).
Export-Import Bank of the United States, Building a Better America: Export-lmport Bank of the United States
2021 Annual Report, p. 22, https://img.exim.gov/s3fs-public/reports/annual/2021/EXIM_2021_ AnnualReport.
pdf (accessed February 22, 2023).
Congressional Budget Office, “Fair-Value Estimates of the Cost of Selected Federal Credit Programs for

2015 to 2024,” May 2014, pp. 1 and 5, httos:/(www.cbo.gov/sites/default/files/cbofiles/attachments/45383-
FairValue.pdf (accessed February 22, 2025).

Export-Import Bank of the United States, Office of Inspector General, Report on Portfolio Risk and Loss
Reserve Allocation Policies, OIG-INS-12-02, September 28, 2012, https://img.exim.gov/s3fs-public/oig/Final-
20Report-20Complete-20Portfolio-20Risk-20120928-1.pdf#:~:text=Date%3A%20September%2028%2C%20
2012%201%20am%20pleased%20to,measure%2C%20price%2C%20and%20reserve%20for%20its%20
portfolio%2Orisk. (accessed March 21, 2023). See also Export-Import Bank of the United States, Office of
Inspector General, Export-/mport Bank’s Management of Direct Loans and Related Challenges, O|G-AR-13-05,
September 26, 2013, https://img.exim.gov/s3fs-public/oig/audit/OIG-Final-Report-Audit-of-Ex-Im-Bank-s-
Management-of-Direct-Loans-and-Related-Challenges-09-26-13-2.pdf (accessed March 21, 2023).

Veronique de Rugy and Justin Leventhal, “The Ex-Im Bank Is More Responsible Without a Quorum,” Mercatus
Center at George Mason University Data Visualization, December 11, 2018, https://www.mercatus.org/research/
data-visualizations/ex-im-bank-more-responsible-without-quorum#:~:text=At%2063%20percent%20
without%20a%20quorum%2C%20the%20Ex-Im,is%20doing%20better%20without%20the%20Ex-Im%20
Bank%E2%80%99s%20aid (accessed February 22, 2023).
Figure 3, “Arrangement Official Export Credits—Destination Countries by Income Level (Billion USD),” in
Organisation for Economic Co-operation and Development, “Export Credit Statistics: Trends and Cashflow:
Trends in Arrangement Official Export Credits (2009-2019),” https://www.oecd.org/trade/topics/export-
credits/statistics/ (accessed March 21, 2023).

Export-Import Bank of the United States, Bui/ding a Better America: Export-Import Bank of the United States
2021 Annual Report, pp. 19, 44, and 47.
Export-Import Bank of the United States, Annua/ Management Report for the Year-Ended September 30,
2022, and September 350, 2021, pp. 1, 7 and 57.

ews release, “Ex-Im Bank FY 2012 Annual Report Details Fourth Consecutive Record-Breaking Year,” Export-
mport Bank of the United States, November 26, 2012, https://www.exim.gov/news/ex-im-bank-fy-2012-
annual-report-details-fourth-consecutive-record-breaking-year (accessed March 21, 2023).

Bloomberg News, “China Retreats on Going Toe-to-Toe with US on Critical Tech,” The Sydney Morning Herald,
January 4, 2023, https://www.smh.com.au/business/the-economy/china-retreats-on-going-toe-to-toe-with-
us-on-critical-tech-20230104-p5cae9.html (accessed February 23, 2023).

— 729 —

34,

35.

Mandate for Leadership: The Conservative Promise

President Ronald Reagan, “Statement on Signing the Export-Import Bank Act Amendments of 1986,” October
15, 1986, https://www.presidency.ucsb.edu/documents/statement-signing-the-export-import-bank-act-
amendments-1986 (accessed February 22, 2023).

Export-Import Bank of the United States, Report to the U.S. Congress on Global Export Credit Competition for
the Period January 1, 2018, Through December 31, 2018, June 2019, https://img.exim.gov/s3fs-public/reports/
competitiveness_reports/2019/EXIM2019CompetitivenessReport-final.odf (accessed February 18, 2023).

— 730 —

24.

FEDERAL RESERVE

Paul Winfree

oney is the essential unit of measure for the voluntary exchanges that

constitute the market economy. Stable money allows people to work

freely, helps businesses grow, facilitates investment, supports saving
for retirement, and ultimately provides for economic growth. The federal govern-
ment has long made policy regarding the nation’s money on behalf of the people
through their elected representatives in Congress.’ Over time, however, Congress
has delegated that responsibility first to the Department of the Treasury and now
to the quasi-public Federal Reserve System.

The Federal Reserve was created by Congress in 1913 when most Americans lived
in rural areas and the largest industry was agriculture. The impetus was a series of
financial crises caused both by irresponsible banks and other financial institutions that
overextended credit and by poor regulations. The architects of the Federal Reserve
believed that a quasi-public clearinghouse acting as lender of last resort would reduce
financial instability and end severe recessions. However, the Great Depression of the
1930s was needlessly prolonged in part because of the Federal Reserve's inept manage-
ment of the money supply. More recessions followed in the post-World War II years.

In the decades since the Federal Reserve was created, there has been a down-
turn roughly every five years. This monetary dysfunction is related in part to the
impossibility of fine-tuning the money supply in real time, as well as to the moral
hazard inherent in a political system that has demonstrated a history of bailing
out private firms when they engage in excess speculation.

Public control of money creation through the Federal Reserve System has
another major problem: Government can abuse this authority for its own advantage

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by printing money to finance its operations. This necessitated the original Federal
Reserve’s decentralization and political independence. Not long after the central
bank’s creation, however, monetary decision-making power was transferred away
from regional member banks and consolidated in the Board of Governors.

The Federal Reserve’s independence is presumably supported by its mandate
to maintain stable prices. Yet central bank independence is challenged in two addi-
tional ways. First, like any other public institution, the Federal Reserve responds to
the potential for political oversight when faced with challenges.? Consequently, its
independence in conducting monetary policy is more assured when the economy is
experiencing sustained growth and when there is low unemployment and price stabil-
ity—but less so in a crisis.’ Additionally, political pressure has led the Federal Reserve
to use its power to regulate banks as a way to promote politically favorable initiatives
including those aligned with environmental, social, and governance (ESG) objectives.*

Even formal grants of power by Congress have not markedly improved Federal
Reserve actions. Congress gave the Federal Reserve greater regulatory authority
over banks after the stock market crash of 1929. During the Great Depression, the
Federal Reserve was given the power to set reserve requirements on banks and to
regulate loans for the purchase of securities. During the stagflation of the 1970s,
Congress expanded the Federal Reserve’s mandate to include “maximum employ-
ment, stable prices, and moderate long-term interest rates.”° In the wake of the
2008 global financial crisis, the Federal Reserve’s banking and financial regulatory
authorities were broadened even further. The Great Recession also led to innova-
tions by the central bank such as additional large-scale asset purchases.

Together, these expansions have created significant risks associated with “too big
to fail” financial institutions and have facilitated government debt creation.° Collec-
tively, such developments have eroded the Federal Reserve’s economic neutrality.

In essence, because of its vastly expanded discretionary powers with respect
to monetary and regulatory policy, the Fed lacks both operational effectiveness
and political independence. To protect the Federal Reserve’s independence and
to improve monetary policy outcomes, Congress should limit its mandate to the
sole objective of stable money.

This chapter provides a number of options aimed at achieving these goals along
with the costs and benefits of each policy recommendation. These recommended
reforms are divided into two parts: broad institutional changes and changes involv-
ing the Federal Reserve’s management of the money supply.

BROAD RECOMMENDATIONS
e Eliminate the “dual mandate.” The Federal Reserve was originally

created to “furnish an elastic currency” and rediscount commercial paper
so that the supply of credit could increase along with the demand for money

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and bank credit. In the 1970s, the Federal Reserve’s mission was amended
to maintain macroeconomic stability following the abandonment of the
gold standard.’ This included making the Federal Reserve responsible for
maintaining full employment, stable prices, and long-term interest rates.

Supporters of this more expansive mandate claim that monetary policy

is needed to help the economy avoid or escape recessions. Hence, even if
there is a built-in bias toward inflation, that bias is worth it to avoid the
pain of economic stagnation. This accommodationist view is wrong. In fact,
that same easy money causes the clustering of failures that can lead to a
recession. In other words, the dual mandate may inadvertently contribute
to recessions rather than fixing them.

A far less harmful alternative is to focus the Federal Reserve on protecting
the dollar and restraining inflation. This can mitigate economic turmoil,
perhaps in conjunction with government spending. Fiscal policy can be
more effective if it is timely, targeted, and temporary.® An example from the
COVID-19 pandemic is the Paycheck Protection Program, which sustained
businesses far more effectively than near-zero interest rates, which mainly
aided asset markets and housing prices. It is also worth noting that the
problem of the dual mandate may worsen with new pressure on the Federal
Reserve to include environmental or redistributionist “equity” goals in its
policymaking, which will likely enable additional federal spending.’

Limit the Federal Reserve’s lender-of-last-resort function. To protect
banks that over lend during easy money episodes, the Federal Reserve

was assigned a “lender of last resort” CLOLR) function. This amounts

to a standing bailout offer and encourages banks and nonbank financial
institutions to engage in reckless lending or even speculation that both
exacerbates the boom-and-bust cycle and can lead to financial crises such as
those of 1992?° and 2008" with ensuing bailouts.

This function should be limited so that banks and other financial
institutions behave more prudently, returning to their traditional role as
conservative lenders rather than taking risks that are too large and lead to
still another taxpayer bailout. Such a reform should be given plenty of lead
time so that banks can self-correct lending practices without disrupting a
financial system that has grown accustomed to such activities.

Wind down the Federal Reserve’s balance sheet. Until the 2008 crisis,
the Federal Reserve never held more than $1 trillion in assets, bought largely

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Mandate for Leadership: The Conservative Promise

to influence monetary policy." Since then, these assets have exploded, and
the Federal Reserve now owns nearly $9 trillion of mainly federal debt
($5.5 trillion)’* and mortgage-backed securities ($2.6 trillion)."* There is
currently no government oversight of the types of assets that the Federal
Reserve purchases.

These purchases have two main effects: They encourage federal deficits

and support politically favored markets, which include housing and even
corporate debt. Over half of COVID-era deficits were monetized in this way
by the Federal Reserve’s purchase of Treasuries, and housing costs were
driven to historic highs by the Federal Reserve’s purchase of mortgage
securities. Together, this policy subsidizes government debt, starving
business borrowing, while rewarding those who buy homes and certain
corporations at the expense of the wider public.

Federal Reserve balance sheet purchases should be limited by Congress,
and the Federal Reserve’s existing balance sheet should be wound down as
quickly as is prudent to levels similar to what existed historically before the
2008 global financial crisis."

Limit future balance sheet expansions to U.S. Treasuries. The Federal
Reserve should be prohibited from picking winners and losers among

asset classes. Above all, this means limiting Federal Reserve interventions
in the mortgage-backed securities market. It also means eliminating Fed
interventions in corporate and municipal debt markets.

Restricting the Fed’s open market operations to Treasuries has strong
economic support. The goal of monetary policy is to provide markets
with needed liquidity without inducing resource misallocations caused
by interfering with relative prices, including rates of return to securities.
However, Fed intervention in longer-term government debt, mortgage-
backed securities, and corporate and municipal debt can distort the
pricing process. This more closely resembles credit allocation than
liquidity provision.

The Fed’s mortgage-related activities are a paradigmatic case of what
monetary policy should not do. Consider the effects of monetary policy on
the housing market. Between February 2020 and August 2022, home prices
increased 42 percent.”° Residential property prices in the United States
adjusted for inflation are now 5.8 percent above the prior all-time record
levels of 2006.” The home-price-to-median-income ratio is now 7.68, far

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2025 Presidential Transition Project

above the prior record high of 7.0 set in 2005.'* The mortgage-payment-to-
income ratio hit 43.3 percent in August 2022—breaking the highs of the prior
housing bubble in 2008.”° Mortgage payment on a median-priced home (with
a 20 percent down payment) jumped to $2,408 in the autumn of 2022 vs.
$1,404 just one year earlier as home prices continued to rise even as mortgage
rates more than doubled. Renters have not been spared: Median apartment
rental costs have jumped more than 24 percent since the start of 2021.7°
Numerous cities experienced rent increases well in excess of 30 percent.

A primary driver of higher costs during the past three years has been the
Federal Reserve’s purchases of mortgage-backed securities (MBS). Since
March 2020, the Federal Reserve has driven down mortgage interest rates
and fueled a rise in housing costs by purchasing $1.3 trillion of MBSs from
Fannie Mae, Freddie Mac, and Ginnie Mae. The $2.7 trillion now owned by
the Federal Reserve is nearly double the levels of March 2020. The flood of
capital from the Federal Reserve into MBSs increased the amount of capital
available for real estate purchases while lower interest rates on mortgage
borrowing—driven down in part by the Federal Reserve’s MBS purchases—
induced and enabled borrowers to take on even larger loans.”! The Federal
Reserve should be precluded from any future purchases of MBSs and should
wind down its holdings either by selling off the assets or by allowing them to
mature without replacement.

Stop paying interest on excess reserves. Under this policy, also started
during the 2008 financial crisis, the Federal Reserve effectively prints
money and then “borrows” it back from banks rather than those banks’
lending money to the public. This amounts to a transfer to Wall Street at
the expense of the American public and has driven such excess reserves

to $3.1 trillion, up seventyfold since 2007.” The Federal Reserve should
immediately end this practice and either sell off its balance sheet or simply
stop paying interest so that banks instead lend the money. Congress should
bring back the pre-2008 system, founded on open-market operations. This
minimizes the Fed’s power to engage in preferential credit allocation.

MONETARY RULE REFORM OPTIONS

While the above recommendations would reduce Federal Reserve manipulation

and subsidies, none would limit the inflationary and recessionary cycles caused by

the Federal Reserve. For that, major reform of the Federal Reserve’s core activity

of manipulating interest rates and money would be needed.

Acore problem with government control of monetary policy is its exposure

to two unavoidable political pressures: pressure to print money to subsidize

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government deficits and pressure to print money to boost the economy artificially
until the next election. Because both will always exist with self-interested politi-
cians, the only permanent remedy is to take the monetary steering wheel out of
the Federal Reserve’s hands and return it to the people.

This could be done by abolishing the federal role in money altogether, allowing
the use of commodity money, or embracing a strict monetary-policy rule to ward
off political meddling. Of course, neither free banking nor a allowing commodi-
ty-backed money is currently being discussed, so we have formulated a menu of
reforms. Each option involves trade-offs between how effectively it restrains the
Federal Reserve and how difficult each policy would be to implement, both polit-
ically for Congress and economically in terms of disruption to existing financial
institutions. We present these options in decreasing order of effectiveness against
inflation and boom-and-bust recessionary cycles.

Free Banking. In free banking, neither interest rates nor the supply of money
is controlled by the government. The Federal Reserve is effectively abolished, and
the Department of the Treasury largely limits itself to handling the government’s
money. Regions of the U.S. actually had a similar system, known as the “Suffolk
System,” from 1824 until the 1850s, and it minimized both inflation and economic
disruption while allowing lending to flourish.”

Under free banking, banks typically issue liabilities (for example, checking
accounts) denominated in dollars and backed by a valuable commodity. In the
19th century, this backing was commonly gold coins: Each dollar, for example, was
defined as about 1/20 of an ounce of gold, redeemable on demand at the issuing
bank. Today, we might expect most banks to back with gold, although some might
prefer to back their notes with another currency or even by equities or other assets
such as real estate. Competition would determine the right mix of assets in banks’
portfolios as backing for their liabilities.

As in the Suffolk System, competition keeps banks from overprinting or lending
irresponsibly. This is because any bank that issues more paper than it has assets
available would be subject to competitor banks’ presenting its notes for redemp-
tion. In the extreme, an overissuing bank could be liable to a bank run. Reckless
banks’ competitors have good incentives to police risk closely lest their own hold-
ings of competitor dollars become worthless.™*

In this way, free banking leads to stable and sound currencies and strong finan-
cial systems because customers will avoid the riskier issuers, driving them out
of the market. As a result of this stability and lack of inflation inherent in fully
backed currencies, free banking could dramatically strengthen and increase both
the dominant role of America’s financial industry and the use of the U.S. dollar
as the global currency of choice.” In fact, under free banking, the norm is for the
dollar’s purchasing power to rise gently over time, reflecting gains in economic
productivity. This “supply-side deflation” does not cause economic busts. In fact,

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2025 Presidential Transition Project

by ensuring that cash earns a positive (inflation-adjusted) rate of return, it can pre-
vent households and businesses from holding inefficiently small money balances.

Further benefits of free banking include dramatic reduction of economic cycles,
an end to indirect financing of federal spending, removal of the “lender of last
resort” permanent bailout function of central banks, and promotion of currency
competition.” This allows Americans many more ways to protect their savings.
Because free banking implies that financial services and banking would be gov-
erned by general business laws against, for example, fraud or misrepresentation,
crony regulatory burdens that hurt customers would be dramatically eased, and
innovation would be encouraged.

Potential downsides of free banking stem from its greatest benefit: It has mas-
sive political hurdles to clear. Economic theory predicts and economic history
confirms that free banking is both stable and productive, but it is radically different
from the system we have now. Transitioning to free banking would require polit-
ical authorities, including Congress and the President, to coordinate on multiple
reforms simultaneously. Getting any of them wrong could imbalance an otherwise
functional system. Ironically, it is the very strength of a true free banking system
that makes transitioning to one so difficult.

Commodity-Backed Money. For most of U.S. history, the dollar was defined in
terms of both gold and silver. The problem was that when the legal price differed
from the market price, the artificially undervalued currency would disappear from
circulation. There were times, for instance, when this mechanism put the US. on
ade facto silver standard. However, as a result, inflation was limited.

Given this track record, restoring a gold standard retains some appeal among
monetary reformers who do not wish to go so far as abolishing the Federal Reserve.
Both the 2012 and 2016 GOP platforms urged the establishment of a commis-
sion to consider the feasibility of a return to the gold standard,” and in October
2022, Representative Alexander Mooney (R-WV) introduced a bill to restore the
gold standard.*8

In economic effect, commodity-backing the dollar differs from free banking in
that the government (via the Fed) maintains both regulatory and bailout functions.
However, manipulation of money and credit is limited because new dollars are not
costless to the federal government: They must be backed by some hard asset like
gold. Compared to free banking, then, the benefits of commodity-backed money
are reduced, but transition disruptions are also smaller.

The process of commodity backing is very straightforward: Treasury could
set the price of a dollar at today’s market price of $2,000 per ounce of gold. This
means that each Federal Reserve note could be redeemed at the Federal Reserve
and exchanged for 1/2000 ounce of gold—about $80, for example, for a gold coin the
weight of a dime. Private bank liabilities would be redeemable upon their issuers.
Banks could send those traded-in dollars to the Treasury for gold to replenish their

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Mandate for Leadership: The Conservative Promise

vaults. This creates a powerful self-policing mechanism: If the federal govern-
ment creates dollars too quickly, more people will doubt the peg and turn in their

gold to banks, which then will turn in their gold and drain the government’s gold.
This forces governments to rein in spending and inflation lest their gold reserves

become depleted.

One concern raised against commodity backing is that there is not enough gold
in the federal government for all the dollars in existence. This is solved by making
sure that the initial peg on gold is correct. Also, in reality, a very small number of
users trade for gold as long as they believe the government will stick to the price
peg. The mere fact that people could exchange dollars for gold is what acts as the
enforcer. After all, if one is confident that a dollar will still be worth 1/2000 ounce
of gold in a year, it is much easier to walk about with paper dollars and use credit
cards than it is to mail tiny $80 coins. People would redeem en masse only if they
feared the government would not be able control itself, for which the only solution
is for the government to control itself.

Beyond full backing, alternate paths to gold backing might involve gold-con-
vertible Treasury instruments” or allowing a parallel gold standard to operate
temporarily alongside the current fiat dollar.*° These could ease adoption while
minimizing disruption, but they should be temporary so that we can quickly enjoy
the benefits of gold’s ability to police government spending. In addition, Congress
could simply allow individuals to use commodity-backed money without fully
replacing the current system.

Among downsides to acommodity standard, there is no guarantee that the gov-
ernment will stick to the price peg. Also, allowing a commodity standard to operate
along with a fiat dollar opens both up for a speculative attack. Another downside is
that even under a commodity standard, the Federal Reserve can still influence the
economy via interest rate or other interventions. Therefore, at best, a commodity
standard is not a full solution to returning to free banking. We have good reasons
to worry that central banks and the gold standard are fundamentally incompati-
ble—as the disastrous experience of the Western nations on their “managed gold
standards” between World War I and World War II showed.

K-Percent Rule. Under this rule, proposed by Milton Friedman in 1960,” the
Federal Reserve would create money at a fixed rate—say 3 percent per year. By
offering the inflation benefits of gold without the potential disruption to the finan-
cial system, a K-Percent Rule could be a more politically viable alternative to gold.

The principal flaw is that unlike commodities, a K-Percent Rule is not fixed
by physical costs: It could change according to political pressures or random
economic fluctuations. Importantly, financial innovation could destabilize the
market’s demand for liquidity, as happened with changes in consumer credit pat-
terns in the 1970s. When this happens, a given K-Percent Rule that previously
delivered stability could become destabilizing. In addition, monetary policy when

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2025 Presidential Transition Project

Friedman proposed the K-Percent Rule was very different from monetary policy
today. Adopting a K-Percent Rule would require considering what transitions need
to take place.

Inflation-Targeting Rules. Inflation targeting is the current de facto Federal
Reserve rule.** Under inflation targeting, the Federal Reserve chooses a target infla-
tion rate—essentially the highest it thinks the public will accept—and then tries
to engineer the money supply to achieve that goal. Chairman Jerome Powell and
others before him have used 2 percent as their target inflation rate, although some
are now floating 3 percent or 4 percent.** The result can be boom-and-bust cycles
of inflation and recession driven by disruptive policy manipulations both because
the Federal Reserve is liable to political pressure and because making economic
predictions is very difficult if not impossible.

Inflation and Growth-Targeting Rules. Inflation and growth targeting is a
popular proposal for reforming the Federal Reserve. Two of the most prominent
versions of inflation and growth targeting are a Taylor Rule and Nominal GDP
(NGDP) Targeting. Both offer similar costs and benefits.

Economists generally believe that the economy’s long-term real growth trend
is determined by non-monetary factors. The Fed’s job is to minimize fluctuations
around that trend nominal growth rate. Speculative booms and destructive busts
caused by swings in total spending should be avoided. NGDP targeting stabilizes
total nominal spending directly. The Taylor Rule does so indirectly, operating
through the federal funds rate.

NGDP targeting keeps total nominal spending growth on a steady path. If the
demand for money (liquidity) rises, the Fed meets it by increasing the money
supply; if the demand for money falls, the Fed responds by reducing the money
supply. This minimizes the effects of demand shocks on the economy. For example,
if the long-run growth rate of the U.S. economy is 3 percent and the Fed has a5 per-
cent NGDP growth target, it expands the money supply enough to boost nominal
income by 5 percent each year, which translates into 3 percent real growth and 2
percent inflation. How much money must be created each year depends on how
fast money demand is growing.

The Taylor Rule works similarly. It says the Fed should raise its policy rate
when inflation and real output growth are above trend and lower its policy rate
when inflation and real output growth are below trend. Whereas NGDP targeting
focuses directly on stable demand as an outcome, the Taylor Rule focuses on the
Fed’s more reliable policy levers.

The problem with both rules is the knowledge burden they place on central
bankers. These rules state that the Fed should neutralize demand shocks but
not respond to supply shocks, which means that it should “see through” demand
shocks by tolerating higher (or lower) inflation. In theory, this has much to recom-
mend it. In practice, it can be very difficult to distinguish between demand-side

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destabilization and supply-side destabilization in real time. There also are political
considerations: Fed officials may not be willing to curb unjustified economic booms
and all too willing to suppress necessary economic restructuring following a bust.
Either rule likely outperforms a strict inflation target and greatly outperforms
the Fed’s current pseudo-inflation target. While NGDP targeting and the Taylor
Rule have much to commend them, they might be harder to explain and justify to
the public. Inflation targeting has an intelligibility advantage: Voters know what
it means to stabilize the dollar’s purchasing power. Capable elected officials must
persuade the public that the advantages of NGDP targeting and the Taylor Rule,
especially in terms of supporting labor markets, outweigh the disadvantages.

MINIMUM EFFECTIVE REFORMS

Because Washington operates on two-year election cycles, any monetary reform
must take account of disruption to financial markets and the economy at large.
Free banking and commodity-backed money offer economic benefits by limiting
government manipulation, inflation, and recessionary cycles while dramatically
reducing federal deficits, but given potential disruption to the financial system, a
K-Percent Rule may be a more feasible option. The other rules discussed (infla-
tion targeting, NGDP targeting, and the Taylor Rule) are more complicated but
also more flexible. While their economic benefits are significant, public opinion
expressed through the lawmaking process in the Constitution should ultimately
determine the monetary-institutional order in a free society.

The minimum of effective reforms includes the following:

e Have elected officials compel the Fed to specify its target range for
inflation and inform the public of a concrete intended growth path.
There should be no more “flexible average inflation targeting,” which
amounts to ex post justification for bad policy.

e Focus any regulatory activities on maintaining bank capital
adequacy. Elected officials must clamp down on the Fed’s incorporation of
environmental, social, and governance factors into its mandate, including by
amending its financial stability mandate.

e Curb the Fed’s excessive last-resort lending practices. These practices

are directly responsible for “too big to fail” and the institutionalization of
moral hazard in our financial system.

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2025 Presidential Transition Project

e Appoint a commission to explore the mission of the Federal Reserve,
alternatives to the Federal Reserve system, and the nation’s financial
regulatory apparatus.

e Prevent the institution of a central bank digital currency (CBDC). A
CBDC would provide unprecedented surveillance and potential control of

financial transactions without providing added benefits available through
existing technologies.**

AUTHOR’S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but
Alexander Salter, Judy Shelton, and Peter St Onge, deserve special mention. The chapter reflects input from all the
contributors, however, no views expressed herein should be attributed to any specific individual.

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ENDNOTES

i}.

18.

U.S. Constitution, Article 1, Sec
For example, Alexander Salter and Daniel Smith (20
favorable toward monetary discretion once they are
William Salter and
Environments in the Formation of Fed Policy Under
Economics and Finance, Vol. 71 (February 2019), pp. 1
Sarah Binder, “The Federal Reserve as a ‘Political’
Bulletin, Vol. LXIX, No. 3 (Spring 2016), pp. 47-49, https:
downloads/bulletin_Spring2016.pdf (accessed January
Pressures on Monetary Policy During the US Great Infla
Vol. 4, No. 2 (April 2012), pp. 33-64, https://www.haver
Weise Political Pressures _on%20Monetary_Policy.pd
The Federal Reserve's financial stability mandate is poo
statutory vagueness and proceeded as if it has the auth
questionable whether this is permissible.
2 US.C. § 225a, h

Bur

See Peter J. Boettke, Alexander William Salter, and Dani

Daniel J. Smith, “Political Economists or Political Economists? The Role of Poli

13.
nstitu

ion 8, https://www.law.cornell.edu/constitution (accessed January 23, 2023).
9) show that Federal Reserve Chairs become more
confirmed compared to previous stances. Alexander

ical
ns, Greenspan, and Bernanke,” Quarterly Review of

ion,” American Academy of Arts and Sciences
//Www.amacad.org/sites/default/files/bulletin/

23, 2023). See also Charles L. Weise, “Political

ion,” American Economic Journal: Macroeconomics,
ord.edu/sites/default/files/Department/Economics/
(accessed January 23, 2023).

y defined. The Fed has taken advantage of the

ority to engage in these activities, although it is highly

tos://www.law.cornell.edu/uscode/text/12/225a (accessed January 23, 2023).

el J. Smith, Money and the Rule of Law: Generality

and Predictability in Monetary Institutions (Cambridge,
George Selgin, Wi
Macroeconomics, Vol. 34, No. 3 (September 2012
article/abs/pii/SO
This includes federal

_pp.5
64070412000304 (accessed January

example, unemployment insurance or the Supplemental
lience Tests with Big Banks,” ESG Today, September 30,

ark Segal, “Fed to Launch Climate Risk Resi

January 23, 2023).

Russell Roberts, “Gambling with O
ercatus Center at George Mason
pdf (accessed January 24, 2023).
Board of Governors of the Federa
Se
January 24, 2023).
Board of Governors of the Federa
https://fred.stlouisfed.org/series/TREAST (accessed Jan
Board of Governors of the Federal Reserve Sys
2004-2022, https://fred.stlouisfed.org/series/WSHOMC
Board of Governors of the Federal Reserve System, To
Series (WALCL), 2004-2022, ht
Federal Reserve Bank of St. Louis, “S&P Dow Jones
(CSUSHPINSA),” https://fred.stlouisfed.org/series/CSUSH
Home Price Index tracks home prices given a constan
S&P CoreLogic Case-Shiller Home Price Indices,” h
corelogic-case-shiller/sp-corelogic-case-shiller-composi
Federal Reserve Bank of St. Louis, “Real Residential Pro

her People’s Money:
University, May 2010,

Reserve Sys

Reserve System, U.S.

Longterm Trends, “Home Price to Income Ratio (US & U

January 24, 2023).

— 742

liam D. Lastrapes, and Lawrence H. White, “Has the Fed Been

2022, https://www.esgtoday.com/fed-to-launch-climate-

em, Credi
ies, 2007-2022, https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm (accessed

em, Mortgage-Backed Securities Data Series (WSHOMCB),

al Assets (Less Eliminations from Consolidation)
ps://fred.stlouisfed.org/series/WALCL (accessed January 24, 2023).
ndices LLC, S&P/Case-Shiller U.S. National Home Price

UK: Cambridge University Press, 2021).

a Failure?” Journal of
69-596, https://www.sciencedirect.com/science/
24, 2023).

programs that automatically provide for adjustments as the economy contracts (for

utrition Assistance Program).

isk-resilience-tests-with-big-banks/ (accessed

Kenneth J. Robinson, “Savings and Loan Crisis 1980-1989,” Federal Reserve Bank of St. Louis, Federal Reserve
History, November 22, 2013, https://Awww.federalreservehistory.org/essays/savings-and-loan-crisis (accessed

How Perverted Incentives Caused the Financial Crisis,”
https://www.mercatus.org/system/files/RUSS-final.

and Liquidity Programs Balance Sheet Data

Treasury Securities Data Series (TREAST), 2004-2022,
uary 24, 2023).

B (accessed January 24, 2023).
Data

Index
ller

PINSA (accessed January 24, 2023). The Case-Shi

level of quality. See S&P Dow Jones Indices, “Real Estate:
ps:/Awww.spglobal.com/spdji/en/index-family/indicators/sp-
e/tHoverview (accessed January 24, 2023).

perty Prices for United States (QUSR628BIS),” https://

red.stlouisfed.org/series/QUSR368BIS (accessed January 24, 2023).

K): Home Price to Median Household Income

Ratio (US),” https://www.longtermtrends.net/home-price-median-annual-income-ratio/ (accessed

19.

20.

21.

22.

25.

24.

25.

26.

27.

28.

29.

30.

31.

32.

53:

34,

2025 Presidential Transition Project

Federal Reserve Bank of Atlanta, “Me
October 2022, ht
affordability-monitor.aspx (accessed J
Apartment List Research Team, “Apar

apartmentlist.com/research/national-rent-data

Primary drivers of rising real estate pri
guarantees through government-spon

unpriced impli

ps://www.atlantafed.

ro Area H
)
anuary 24, 2023).
ment List Nationa

ces national
sored en

y also
erprises

economy’s capital to be invested in ho’

Office, “Transi

(TOTRESNS),

Rowman & Li
Enfo

cing Monetary Constitutions with
Reforms should a
(owners) to monitor bank port
Roosevelt recognized. Bailouts
Under the current system, ban
mechanism for supplying the correct n
F. A. Hayek, Denationalization of Mone
Currencies (London, UK: Institute of Ec
Kate Davidson, “GOP Platform
July 20, 2016, https://www.wsj.com/art
standard-1469047214?mod=ar
H.R. 9157, To Define the
Act), 117th Congress, int
pdf (accessed January 24, 2023).
Judy Shelton, “Gold and Government,”
https://www.cato.org/si
(accessed January 24, 2023).
Lawrence H. White, “Ma

and las

4.odf (accessed
Juha Ki
Growth

January 24, 2023).

Bank 0

8, 202

February 1, 2022).

ioning to Alternative Struc
www.cbo.gov/system/files/2018-08/54218-GSEupdate.pdf
Board of Governors of the Federal Reserve System
960-2022, https://fred.stlouisfed.org/series/1
George A. Selgin, The Theory of Free Banking: Money Supply Under Competitive Note Issue (Totowa, NJ:
tlefield, 1998). See also Alexander William Sa

icle_inli

ures for

Reference to the Su

onomic Affairs, 1976).

icles/gop-platform-incl

Cato Journal, Vol. 32,

es/cato.org/files/serials/files/cato-jou

ing the Transition to a New Gold Stan
Summer 2012), pp. 411-421, https://www.cato.org/sites/cato.org/

ponen and Kai Leitemo, “Model Uncertainty and Delega
Rule?” Journal of Money, Credit and Banking, Vol. 40, No. 2/3 (March-April 2008), pp. 547-556.
Adam Shapiro and Daniel J. Wilson, “The Evolution of the FOMC’
San Francisco, FRBSF Economic Letter No. 2019-12, Apri
uploads/sites/4/el2019-12.pdf (accessed January 24, 2023).
WSJ Pro, “Research Says a 3% Fed Inflation Target Could Boost Job
, https://www.ws).com/articles/research-says-a-3-fed-in
1629308829#:~:text=Research%20Says%20a%203%25%20Fed%20
OBoost%20Job%20Market,-Aug.&text=Two%20former%20high%2D
he%20job%20market (accessed January 24, 2023). See also Oliver Blanchard, “It Is Time to Revisit the 2%
nflation Target,” Financial Times, November 28, 2022, https://www.f
cacl20d25588 (accessed January 24, 2023).
Alexander William Salter, “CBDC in the USA: Not Now, Not Ever,” American Institute for Economic

Research, December, 13, 2022, https://www.aier.org/article/cbdc-in-the-usa-not-now-not-ever/ (accessed

— 743 —

ome Ownership Affordabi
g/center-for-housing-and-policy/data-and-tools/nome-ownership-

Rent Report,” Ja
(accessed January 24, 2023).
include governmen
GSEs)—namely,
cit guarantee, which reduced interest rates for mortgage borrowers, helped cause more of the
sing than might otherwise have been
Housing Finance: An Upda

ity Monitor (HOAM) Index,”

nuary 4, 2023, https://www.

subsidies and government
Fannie Mae and Freddie Mac. “The

the case.” Congressional Budget
e,” August 2018, p. 7, https://

accessed January 24, 2023).
, Reserves of Depository Institutions Data Series
TOTRESNS (accessed January 24, 2023).

ter and Andrew T. Young, “A Theory of Self-
folk System, 1825-1858,” Journal of Economic
Behavior & Organization, Vol. 156 (December 2018), pp 13-22.
so strengthen the incentives of bank depositors (customers) and bank shareholders

olios. Deposit insurance undermines the former, as even President Franklin
-resort lending undermine the latter.

S are supplying the U.S. dollars. Legislation would been needed that includes a
umber of U.S. dollars along with their own notes.

An Analysis of the Theory and Current Practice of Concurrent

Includes Proposal to Study Return to Gold Standard,” The Wall Street Journal,

des-proposal-to-study-return-to-gold-

ne (accessed January 24, 2023).
Dollar as a Fixed Weight of Gold, and
oduced October 7, 2022, https://www.

or Other Purposes (Gold Standard Restoration
congress.gov/117/bills/hr9157/BILLS-117hr9157ih.

o. 2 (Spring/Summer 2012), pp. 333-347,
rnal/2012/7/v32n2-9.pdf?mod=article_inline

dard,” Cato Journal, Vol. 32, No. 2 (Spring/
iles/serials/files/cato-journal/2012/7/v32n2-
ion: A Case for Friedman’s k-Percent Money

s Explicit Inflation Target,” Federal Reserve
15, 2019, https://Awww.frbsf.org/wp-content/

arket,”
ation-targe

The Wall Street Journal, August
-could-boost-job-market-
nflation%20Target%20Could%2-
evel%20Federal,help%20bolster%20

.com/content/02c8a9ac-b71d-4cef-a6ff-

SMALL BUSINESS
ADMINISTRATION

Karen Kerrigan

MISSION STATEMENT

The U.S. Small Business Administration (SBA) supports U.S. entrepreneurship
and small business growth by strengthening free enterprise through policy advo-
cacy and facilitating programs that help entrepreneurs to launch and grow their
businesses and compete effectively in the global marketplace.

OVERVIEW

Created almost 70 years ago, the SBA was launched under the Small Business
Act with a mission to “aid, counsel, assist and protect, insofar as is possible, the
interests of small business concerns.”! According to its current mission statement:

The U.S. Small Business Administration (SBA) helps Americans start, grow,
and build resilient businesses.

SBA was created in 1953 as an independent agency of the federal government
to aid, counsel, assist and protect the interests of small business concerns;
preserve free competitive enterprise; and maintain and strengthen the overall

economy of our nation.’

The SBA’s founding mission has evolved over time as programs have been
expanded or implemented, subject to the philosophical grounding of each Admin-
istration as well as assorted economic challenges and the occurrence of natural
disasters. Because of its distinct role in the federal government, the SBA became

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Mandate for Leadership: The Conservative Promise

the default agency for providing disaster loans to small businesses, homeowners,
renters, and organizations. As aresult, hundreds of billions of taxpayer dollars have
been funneled through the agency to businesses and individuals over the years.

Some SBA programs are effective; others are not. The largest program in SBA’s
history, the Paycheck Protection Program (PPP), has been credited with saving
millions of jobs during the COVID-19 pandemic.’ A conservative Administration
would rightly focus on saving small businesses during such a crisis. At the same
time, however, various SBA programs have generated waste, fraud, and misman-
agement of taxpayer dollars.

For example, and more recently, more than $1 trillion in COVID-19 relief was
distributed through the SBA.“* The SBA’s EIDL (Economic Injury Disaster Loan)
Advance program in particular shows the dangers that can come with direct
government lending. EIDL Advance provided direct cash grants and loans to
small businesses. The SBA Office of Inspector General “identified $78.1 billion in
potentially fraudulent EIDL loans and grants paid to ineligible entities,”® which
represented more than half of all funds spent through the program. Although PPP
worked through private lenders and as a result experienced relatively less fraud
than EIDL experienced, it is estimated “that at least 70,000 [PPP] loans were
potentially fraudulent.”°

ORIGIN, HISTORY, AND CORE FUNCTIONS
In 1954, the agency began to execute such core functions as “making and

29 66

guaranteeing loans for small businesses,” “ensuring that small businesses earn
a ‘fair proportion’ of government contracts and sales of surplus property,” and
“provid[ing] business owners with management and business training.”

In 1970, President Richard Nixon’s Executive Order 11518 enhanced the agen-
cy’s advocacy role by providing for the “increased representation of the interests
of small business concerns before departments and agencies of the United States
Government.”® This advocacy role was strengthened with the adoption of the Small
Business Amendments of 1974,’ which established the Chief Counsel for Advocacy,
and was then reinforced and expanded in 1976 with the creation of the Office of
Advocacy, providing additional resources to ensure that small businesses had a
voice in the regulatory process.

In 1980, the Regulatory Flexibility Act (RFA)"° further strengthened the Office
of Advocacy’s role, providing accountability across federal agencies to ensure that
they considered the impact of their rulemakings on small businesses. The RFA
requires federal agencies “to consider the effects of their regulations on small
businesses and other small entities,’" and the Office of Advocacy is charged with
ensuring that federal agencies abide by the law and is required to provide an annual
report to the President and the Senate and House Committees on Small Business.”
In addition, the Trade Facilitation and Trade Enforcement Act (TFTEA) of 2016"

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2025 Presidential Transition Project

established a new role for the Office of Advocacy: “to facilitate greater consider-
ation of small business economic issues during international trade negotiations.”“

This small office has been relatively effective over the years—and more produc-
tive during periods when a strong Chief Counsel for Advocacy has been installed
to utilize the Office of Advocacy’s authority aggressively to provide a check on
regulatory overreach. The office is one of the bright spots within the SBA that a
conservative Administration could supercharge to dismantle extreme regulatory
policies and advance limited-government reforms that promote economic freedom
and opportunity.

Currently, the SBA’s four core functions include:

e Access to capital. SBA maintains assorted financing and lending
programs for small businesses, from microlending to debt and equity
investment capital.

e Entrepreneurial development programs. SBA provides “free” or low-
cost training at more than 1,800 locations and through online platforms

and webinars.

e Government contracting support programs. Through goals established
by the SBA for federal departments and agencies, the broader goal is to
ensure that small businesses win 23 percent of prime contracts.

e Advocacy. This independent office within the SBA works to ensure
that federal agencies consider small businesses’ concerns and impact in
rulemakings. The office also conducts small-business research.

BUDGETARY FLUCTUATION

SBA’s budget and programs have expanded significantly under some Admin-
istrations and have been scaled back under others. President Ronald Reagan cut
the SBA’s budget by more than 30 percent, and his annual budgets regularly pro-
posed to eliminate the agency altogether.’ Under President George W. Bush, SBA
Administrator Hector Barreto said that SBA’s goal was “to do more with less,”
but this changed because of Hurricane Katrina and a surge in disaster funding.
In 2016, President Barack Obama considered streamlining and combining SBA
programs and other business-related agencies and programs under one entity at
the U.S. Department of Commerce, but opposition within the small-business lobby
in Washington scuttled the effort.”

In general, SBA budget fluctuations have been driven by several factors such as
efforts by Administrations either to cut or to greatly expand programs, the need to
boost disaster assistance because of economic or weather-related events, business

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Mandate for Leadership: The Conservative Promise

loan credit subsidy costs, and miscellaneous program “enhancements” to support
small businesses through economic challenges or circumstances. As noted by the
Congressional Research Service:

Overall, the SBA’s appropriations have ranged from a high of over $761.9
billion in FY2020 to a low of $571.8 million in FY2007. Much of this volatility
is due to significant variation in supplemental appropriations for disaster
assistance to address economic damages caused by major hurricanes and for
SBA lending program enhancements to help small businesses access capital
during and immediately following recessions. For example, in FY2020, the
SBA received over $760.9 billion in supplemental appropriations to assist
small businesses adversely affected by the novel coronavirus (COVID-

19) pandemic."®

The CRS further notes that “[o]verall, since FY2000, appropriations for SBA’s
other programs, excluding supplemental appropriations, have increased at a pace
that exceeds inflation.”

In terms of current loan volume, the SBA “reached nearly $43 billion in fund-
ing to small businesses, providing more than 62,000 traditional loans through its
7(a), 504, and Microloan lending partners and over 1,200 investments through
SBA licensed Small Business Investment Companies (SBICs) for Fiscal Year (FY)
2022.”°° The agency’s total budgetary resources for FY 2022 amount to $44.25
billion, which represents 0.4 percent of the FY 2022 U.S. federal budget.”

HISTORY OF MISMANAGEMENT

Throughout its history, various SBA programs and practices have generated
negative news headlines and scathing Government Accountability Office (GAO)
and Inspector General (IG) reports that have centered on mismanagement, lack
of competent personnel and/or systems, and waste, fraud and abuse.” From the 8a
program” to Hurricane Katrina” to the more current COVID-19 (EIDL) program
and PPP lending program,” the SBA has managed to maintain its lending role even
when repeated system failures have affected its distribution of funds.

Congress has been somewhat responsive, pressuring the SBA to clean up
fraud-related matters within its COVID-19 lending and grant programs.” Repub-
licans in the U.S. House of Representatives have gone farther, specifying that the
SBA needs to improve transparency and accountability and deal with mission creep,
the expansion of unauthorized programs, and structural and reporting deficiencies
that have allowed mismanagement and fraud to reoccur, largely through massive
supplemental appropriations.”’

The SBA is led by an Administrator (currently a member of the President’s
Cabinet) and a Deputy Administrator. Senate-confirmed appointees include

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2025 Presidential Transition Project

the Administrator, Deputy Administrator, Chief Counsel for Advocacy, and
Inspector General.

Entrepreneurs and small businesses require limited-government policies that
do not impede their risk-taking and growth. A future Administration can leverage
and strengthen core SBA functions that have been fairly effective at reining in
and calling attention to costly regulations and policies that are harmful to small
businesses. This core advocacy function is aided both by statutory authority and
by a network of small-business organizations and allies that support limited-gov-
ernment policies.”*

Moreover, an effective SBA Administrator and leadership team can work and
advocate across the federal government to ensure that extreme regulatory poli-
cies—or anticompetitive rules and actions that may favor big businesses over small
businesses or international competitors over American small businesses—are
dismantled or do not progress when proposed.

MISSION CREEP AND ENLARGEMENT

As noted, Republicans in the U.S. House of Representatives have evidenced con-
cern about SBA mission creep and the need to make a sprawling, unaccountable
agency more focused and operationally sound. Moreover, there is unease that the
agency has moved from being open to any eligible small business searching for sup-
port to being hyperfocused on “disproportionately impacted,” politically favored,
or geographically situated small businesses and entrepreneurs.

Today, initiatives aimed at “inclusivity” are in fact creating exclusivity and
stringent selectivity in deciding what types of small businesses and entities can
use SBA programs. For example, even though the SBA under President Donald
Trump proposed arule to remove all of the unconstitutional religious exclusions
from its regulations” to conform with Supreme Court decisions that have made
their unconstitutionality clear, the SBA has not acted on the proposed rule and
still uses religious exclusions in determining eligibility for business loans. Several
other specific concerns include but are not limited to:

e The SBA’s request to become a “designated voter agency” in response to

President Biden’s executive order on “Promoting Access to Voting.”*°

e The creation of duplicative channels and “pilot programs” for the delivery of
business training rather than working through existing counseling partners.
The programs are largely duplicative of private, state and local government,

and educational system offerings.*

e Apush to expand direct government lending.”

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Mandate for Leadership: The Conservative Promise

THE SBA IN A CONSERVATIVE ADMINISTRATION

Reforming and restructuring the SBA under a conservative Administration
would meet the needs of America’s small-business owners and entrepreneurs,
not special interests in Washington, D.C. Entrepreneurs believe the SBA is fairly
archaic in its operations and programming and must be transformed to serve
small businesses in the modern economy effectively.** Therefore, a restructured
and reformed SBA would end the long-term deficiencies, practices, and problems
that have prolonged the decades-long cycle of waste, fraud, and mismanagement.
Moreover, the SBA Administrator and leadership can provide significant value to
all small businesses by strongly advocating for their policy needs and fostering an
agencywide culture that values all small-business owners and does not exclude
certain groups. Under a conservative Administration, success would yield:

e Ahighly qualified SBA Administrator and leadership team that can
competently run the agency and enthusiastically advocate for the policy
issues and needs of small-business owners and entrepreneurs.

e Atighter, more focused SBA that concentrates on congressionally
authorized programs.

e Anaccountable SBA Administrator and staff who report regularly to
Congress, respond on a timely basis to requests from individual Members
of Congress, and satisfactorily implement or respond to IG and GAO
recommendations.

e A full accounting of and an end to waste, fraud, and abuse in all COVID-19
relief programs, including the PPP and EIDL programs, and action that
follows the rule of law by ensuring that loan recipients who are not eligible
for loan forgiveness or who falsified loan applications either pay back the
funds or are referred to law enforcement.

e Anend to SBA direct lending.

e Anapproach to small-business lending and capital programs that supports
aresilient small-business supply chain (for example, by financing
technological upgrades and capital expenditures).

e Outreach to all small businesses and those that are eligible for program
support across sectors and geographic areas. Through congressionally
authorized programs and collaboration with partners and business
associations, the SBA could use the latest technology and platforms to

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2025 Presidential Transition Project

implement relevant initiatives to reach small businesses. Programs would
be nonduplicative and implemented on a first-come, first-served basis.

A modern, revamped, and streamlined SBA that better utilizes current
technology and platforms for operations, for reporting, and in its programs
to reach, service, and engage small businesses.

An Office of Advocacy that is strengthened by a renewed mandate and
additional resources to protect against overregulation along with a research
agenda that includes measuring the total cost that federal regulation
imposes on small businesses.

Accountability and Managerial Practice. The SBA lacks accountability and

managerial practices to measure the effectiveness, success, and integrity of its

various programs. As a future Administration evaluates agency structure and the
particulars of how the SBA is spending appropriated funds, it should immediately
require actions and procedures to compel a culture of accountability and perfor-

mance. Specifically:

Require performance metrics and internal procedures to safeguard
taxpayer dollars and program integrity. As noted in an October 2022
IG report, failure to adopt procedures that would reliably capture data and
information for various programs, coupled with significant challenges and
weaknesses regarding IT investments, systems development, and security
controls, presents significant risks to program integrity and increased

risk of waste, fraud, and abuse.** Addressing these shortcomings and risks
should be a priority challenge and action item for the next Administration.
As underscored by the Inspector General in his introduction to the report,
“Pandemic response has, in many instances, magnified the challenging

systemic issues in SBA’s mission-related work.”*

Review all internal government watchdog recommendations and
require that SBA management implement or address outstanding
and ongoing OIG and GAO recommendations within a specified
time frame (ideally within 90 days of a recommendation) and on an
ongoing basis.

Strengthening the Office of Advocacy. The SBA Office of Advocacy (Advo-
cacy) is “an independent office” within the SBA.*° It accounts for about one
one-thousandth of SBA spending and 0.75 percent of SBA personnel. Under the
Regulatory Flexibility Act, both under its current authority and with suggested

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Mandate for Leadership: The Conservative Promise

reforms, the Office of Advocacy could be a powerful weapon against the adminis-
trative state’s regulatory extremism.

e Amend the RFA so that all agencies are required to provide a copy
of any proposed rule (other than bona fide emergency rules) along
with initial regulatory flexibility analysis to the Office of Advocacy
at least 60 days before a notice of proposed rulemaking is submitted
for publication in the Federal Register. The Office of Advocacy would
submit comments to agencies within 30 days, and each agency would have
to consider these comments, make changes in the proposed rule based
on those comments, or explain in a revised regulatory flexibility analysis
why it chose not to change the proposed rule. The Office of Advocacy’s
pre-proposing comments would be published on the agencies’ and its
own websites.

RFA economic analysis should be expanded to include indirect costs

along with direct costs. In addition, the next Administration should
require other agencies to seek Advocacy’s input. Currently, other agencies
deny Advocacy the ability to enforce their duty to consider the effect of
regulations on small entities by construing their regulations as not having
significant economic impact, which would otherwise serve as a trigger for
Advocacy’s input. Congress should presumptively exempt small businesses
from new agency rules to force agencies to seek Advocacy’s input and
permit new rules to apply to small businesses only with Advocacy signoff
under specified criteria.

e Increase the Office of Advocacy’s budget by at least 50 percent ($4.6
million). This would allow Advocacy to hire approximately 25 attorneys,
economists, and scientists and enhance its role in the regulatory process.

e Explicitly direct federal agencies to comply with the RFA. This would
be similar to the approach adopted by President Trump in his January and
February 2017 executive orders directing agencies to relieve the cost and
burden of regulation on business.*” Advocacy should organize regional
roundtables, onsite small-business visits, and an online platform to hear
directly from small businesses and entities as it did from June 2017 through
September 2018.** This activity produced 26 letters to federal agencies
and highlighted specific regulations that need reform and how Congress
had addressed the most burdensome rules through the Congressional
Review Act.*?

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2025 Presidential Transition Project

COVID-19 Lending Program Accountability and Cleanup. A major
immediate priority for the next Administration should be a final accounting and
accelerated cleanup of fraudulent COVID-19 loan and grant activity. As noted by
the SBA IG, “managing COVID-19 stimulus lending is the greatest overall challenge
facing SBA, and it may likely continue to be for many years as the agency grapples
with fraud in the programs....’*° The next Administration should:

e Consider bringing in private-sector support and expertise to close
out these programs. Forgiveness and fraud must be dealt with as swiftly
as possible, and law enforcement officials must pursue fraud vigorously.
Entities receiving PPP loans that did not meet eligibility for forgiveness
must be required to pay back the money.

For example, under the CARES Act,* PPP loan applicants generally were
eligible only if, together with all their affiliates, they had no more than 500
employees. Numerous Planned Parenthood affiliates self-certified eligibility
for PPP loans during the initial wave of loans that were governed by the
CARES Act’s size requirement. Many Senators and Representatives asserted
that these Planned Parenthood organizations were ineligible because—
considered together with their affiliates—they exceeded the maximum
eligible size.** The Trump Administration SBA notified several Planned
Parenthood PPP recipients of its preliminary determination of their
ineligibility and of SBA’s authority to take various actions against applicants
that falsely certified their eligibility.*

To date, despite continued oversight attempts by Members of Congress,**
the SBA has taken no action on the Planned Parenthood loans other
than to forgive them, and in 2021, it approved new PPP loans to Planned
Parenthood affiliates.”

e Cooperate with ongoing congressional oversight efforts and
determine whether SBA has authority to reverse the forgiveness
decisions. If it does have that authority, the SBA should reverse the
forgiveness decisions for the subject loans, reiterate its preliminary
determinations of ineligibility, investigate the matter more thoroughly, and
take all appropriate action when its investigation concludes. Regardless of
whether it reverses its forgiveness, if its investigation uncovers evidence
that Planned Parenthood affiliates or any other loan recipients knowingly
misrepresented their eligibility in their applications, the SBA should make
appropriate referrals to the Department of Justice.

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Mandate for Leadership: The Conservative Promise

Disaster Loan Program and Direct Lending. The SBA’s disaster loan pro-
gram provides low-interest loans to personal, business, and nonprofit borrowers
following a federally declared disaster. The program suffers from problems of
coordination with Federal Emergency Management Administration (FEMA) disas-
ter assistance. For example, disaster relief applicants have an incentive to avoid
being approved for SBA disaster loans in order to increase the amount of FEMA
assistance for which they are eligible. Moreover, the availability of disaster loans
reduces individuals’ incentives to purchase disaster-related insurance. More than
90 percent of SBA disaster loans are loans to individuals such as homeowners, not
to small businesses.

In view of the challenges the SBA has experienced in its administration of this
program, as well as the fraud and abuse in the EIDL COVID-19-related program
and the IG’s concern that the systemic problems within this lending program
undermine the SBA’s work, the next Administration should:

e Work with Congress to assess the extent to which disaster loans
should be offered by another agency rather than the SBA and explore
private-sector channels for administering the loans.

e Specify clearly that no new direct lending programs will be
developed at the SBA.

Eligibility of Religious Entities for SBA Loans. Current SBA regulations”
and SBA Form 1971” make certain religious entities ineligible to participate in
several SBA loan programs. The Trump Administration proposed a rule that would
remove the provisions on the ground that they violate the First Amendment.*®
Subsequent Supreme Court decisions have made their unconstitutionality clearer.”

In an April 3, 2020, letter to Congress pursuant to 28 U.S. Code § 530D,*° the
Trump Administration SBA advised that two such provisions violate the Free Exer-
cise Clause of the First Amendment and that it therefore would not enforce them.
On January 19, 2021, the Trump Administration SBA proposed a rule to remove
all of the unconstitutional religious exclusions from its regulations.” The SBA has
not acted on the proposed rule.

Asimilar religious exclusion once appeared in the regulation governing eligibil-
ity for SBA Business Loan Programs,” but it was removed in a June 2022 final rule
that noted tension with the First Amendment and Supreme Court precedent.** That
final rule announced that the SBA would nonetheless continue to make religious
eligibility determinations for business loan applicants to comply with putative
Establishment Clause requirements, but Supreme Court precedent and Office of
Legal Counsel memoranda refute the notion that large government-backed loan
programs raise any Establishment Clause concerns.

— 754 -—

2025 Presidential Transition Project

The SBA uses the same “Religious Eligibility Worksheet,” SBA Form 1971, to
make eligibility determinations for all affected programs, including the Business
Loan Programs. Thus, the SBA continues to act as though the unconstitutional
regulation were still in place, and there is no Establishment Clause basis for doing
so. The next Administration should immediately:

e Notify Congress under 28 U.S. Code § 530D that it will not enforce
these unconstitutional regulations.

e Take down SBA Form 1971.

e Finalize the Trump Administration’s proposed rule or publish its own
updated proposed rule to remove the unconstitutional regulations.

Small Business Innovation Research and Small Business Technology
Transfer Programs. The SBA “coordinates and monitors the Small Business
Innovation Research (SBIR) and Small Business Technology Transfer (STTR) pro-
grams for all federal agencies with extramural budgets for research or research and
development (R/R&D) in excess of the expenditures established in sections 9(f)
and 9(n) of the Small Business Act.”*° The SBIR and STTR Extension Act of 2022
extended these programs from September 30, 2022, through September 30, 2025.°”

SBIR requires that 3.2 percent of spending by agencies with extramural R&D
budgets of $100 million or more must be directed to small businesses. STTR allo-
cates 0.45 percent of federal research spending to small firms.** Research has shown
that this small portion of federal R&D spending is disproportionately effective.*°
The SBIR program has consistently demonstrated its ability to fund advanced
technologies through to private-market viability and invests more in America’s
heartland than venture capital invests.

SBIR and STTR have overcome the tendency of federal contracting officers
to deal only with large firms that are familiar to them and have the expertise and
lobbying clout to navigate the federal procurement process. The next Adminis-
tration should:

e Continue the SBIR and SBTT programs as they successfully fund the
next wave of technological innovation to compete with Big Tech.

e Urge Congress to expand the amount that other agencies are required
to set aside from their general R&D budgets for the SBIR program.

e Ensure the enactment of stricter rules requiring that SBIR funds
must be expended on capital investments in the United States.

— 755 —

Mandate for Leadership: The Conservative Promise

Domestic Manufacturing and Small Business. Small businesses in the
manufacturing sector face shortfalls in access to capital.° As manufacturing
employment, domestic business investment, and non-information technology
output have declined,” expectations for market returns and the capital available
to small manufacturing enterprises have diminished. This is especially true for
capital-intensive sectors like transportation and energy that require large up-front
investments and relatively lower-margin sectors like plastics, textiles, furniture,
and agriculture. Yet these industries and others like them traditionally have been
the backbone of American manufacturing employment. They also are sources of
self-sufficiency and resilience at a time when global supply chains are increas-
ingly uncertain.

The public policy problems that are caused by declining small manufacturing
are especially acute when it comes to the production of advanced technologies.
Other agencies and programs invest immense taxpayer resources in basic science
and research. Over time, that research results in some breakthrough technologies,
but when it is time to put these breakthroughs into practice by manufacturing
goods and services, much of the necessary productive capacity is offshore.® For
many technologies, the American economy lacks the capacity to “scale up” inno-
vations that might not be immediately profitable. Instead, those technologies are
put into practice abroad. In this way, foreign companies and foreign productive
sites buy and implement taxpayer-funded American technologies.

The SBA’s existing programs should be reformed to expand the private market
for capital in small-manufacturer expansion. The next Administration should:

e Ask Congress to make available a category of Section 7(a) loans with
a larger available principal that is used to finance manufacturing
facility construction and equipment upgrading. The proposed SBA
Reauthorization and Improvement Act of 2019, for example, would
have increased the maximum loan principal to $50 million for advanced
manufacturing construction and upgrading.” The Section 7(a) loan
program operates through private lenders and guarantees a portion of
private-sector loans made to qualifying small businesses. The maximum
principal available is $5 million, but small businesses in capital-intensive
sectors require significantly larger amounts of capital to finance up-front
capital costs.

e Reform the Small Business Investment Company (SBIC) program
to refocus its support on small businesses rather than technology
startups only. The SBIC program operates through private venture capital
and private equity funds by providing eligible funds with guaranteed debt
financing to support investments in small businesses. However, the program

— 756 —

2025 Presidential Transition Project

largely duplicates private-sector venture capital to the extent that the sector
receiving much of its support is software and information technology, which
already receive the lion’s share of venture capital investment.”

In addition, Congress should reform the SBIC program to make its
financing more favorable to capital-intense investments and small
manufacturers. The Health, Economic Assistance, Liability Protection,
and Schools (HEALS) Act, introduced in 2020, and American Innovation
and Manufacturing Act, introduced in 2021, would allow SBIC to offer
longer-term financing to manufacturers and make the program more
fiscally sustainable.

Small-Business Size Standard Modernization. Many small-business pro-
grams both inside and outside the SBA use the SBA’s definition of “small business.”
Under the Small Business Act, the SBA is tasked with defining what counts as a
small business and ensuring that the definition varies from industry to industry to
reflect differences in regular size by industry. However, the SBA’s small-business
size standards reflect a one-size-fits-all approach under which all businesses within
its size standard are considered small businesses for all eligible purposes, from gov-
ernment contracting preferences to eligibility for SBA loans through private banks.

At the same time, the SBA is an outlier among competing economies in not
considering medium-sized enterprises along with small businesses, often referred
to collectively as small and medium-sized enterprises (SMEs). Medium-sized and
regional businesses are increasingly critical to maintaining competition. The next
Administration should:

e Encourage Congress to create a “medium-sized business”
classification with its eligibility for programs confined to access
to capital programs from projects for which credit elsewhere
does not exist.

SBA POLICY PRIORITIES FOR 2025 AND BEYOND

Legislation. The new Administration can support SBA reform legislation pro-
posed in Congress that aligns with key measures outlined in this chapter. It also
can support legislative initiatives that would help SBA to focus on its core statutory
activities such as capital access, federal contracting opportunities, and regulatory
advocacy. For example:

e The IMPROVE the SBA Act® would strengthen accountability, transparency,

and oversight of the SBA and aligns with many of the reforms outlined in
this chapter.

— 757 —

Mandate for Leadership: The Conservative Promise

e The Small Business Regulatory Flexibility Improvements Act® would
require federal agencies to perform more thorough RFA economic analysis
and provide a rationale for proposed regulations. It also would waive fines
for certain first-time paperwork violations.

e The Small Business Regulatory Enforcement Fairness Act”? (SBREFA) panel
process allows small businesses to provide input on agency rulemakings,
gives participating small businesses greater procedural rights, and allows for
judicial review of agency violations of the SBREFA panel process. SBREFA
panel requirements should be extended to all federal agencies.

e The Fair and Open Competition Act” would disallow the use of project labor
agreements (PLAs) in federal contracting as required in President Biden’s
Executive Order 14063,” which puts small businesses at a competitive
disadvantage and works against the SBA’s governmentwide contracting goal
for small businesses.

e The JOBS Act 4.0% would advance regulatory improvements and
modernization of various Securities and Exchange Commission (SEC) rules
to enhance capital formation and access.

ORGANIZATIONAL ISSUES AND BUDGET

Administrator and Key Staff. The position of Administrator should not be
considered asymbolic or messaging-related position as some past Administrations
have viewed it. Rather, the Administrator should have the requisite experience,
skills, and knowledge to ensure that the SBA fulfills its statutory authorities.

Because much of the SBA’s statutory authority relates to financing and reg-
ulatory policy, and in order to make the SBA a more effective agency within the
Administration, the Administrator and his or her key staff should have experience
in small-business finance and investment and/or administrative law. For example,
during the COVID-19 pandemic, the SBA was often forced to outsource key deci-
sions and administrative follow-through to the Department of the Treasury. The
SBA Administrator and leadership team must share the President’s mission and
vision and execute the Administration’s policies effectively.

Budget

The next Administration should undertake a comprehensive review of the
effectiveness of its various loan and grant programs and provide a report to
Congress within six months. The report should rank programs by cost-effective-
ness. In the interim, the roughly $1 billion overall agency budget should be held
constant until the report is considered, after which Congress should terminate

— 758 —

2025 Presidential Transition Project

ineffective programs, consolidate duplicative functions, and reallocate resources
to more effective programs (such as the Office of Advocacy) or consider reducing
the SBA budget.

Personnel Challenges

The SBA continues to expand programs and initiatives without first document-
ing the effectiveness of existing programs or whether they involve areas in which
the agency lacks staff expertise. For example, the SBA wants to expand the number
of licensed Small Business Lending Companies (SBLCs), implement a new “Mis-
sion-Based SBLC,” and remove a requirement for loan authorization within the
7(a) and 504 Loan programs and rely solely on a lender’s documents.

Various IG reports have noted that the lack of skilled employees within the
SBA has fueled fraud and mismanagement in COVID-19 lending programs, and
congressional leaders have expressed alarm about these “changes that haphazardly
overextend the SBA’s responsibilities at a time when they are devastated by fraud
and underperforming on their core mission of serving the nation’s 33 million small
businesses.”” A conservative Administration should rein in these idealistic and
impractical efforts, get current programs under control and properly staffed with
people who can manage and perform competently, and outsource efforts where
private-sector expertise is appropriate and more efficient.

AUTHOR’S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but David
Burton and Caleb Orr deserve special mention. The author alone assumes responsibility for the content of this
chapter, and no views expressed herein should be attributed to any other individual.

— 759 —

Mandate for Leadership: The Conservative Promise

ENDNOTES

S. 3331, Smal
congress.gov/93/statute/S
S. 299,

Tt oes MQ «€

COVID-
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organization

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gov/117/plaws/publ188/PLAW-I17publ188.pdf (accessed February 17, 2023).

S. Small Business Administration, “About SBA: Organization: Mission,” httos://www.sba.gov/about-sba/

organization (accessed February 19, 2023).

ichael Faulkender, Robert Jackman, and Stephen |. Miran, “The Job-Preservation Effects of Paycheck

rotection Program Loans

0. 2020-01, December 2020, p.
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February 16, 2023).
Kevin Brewer, “Bills Extend Statu
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Sacha Pfeiffer, “Virtually All PPP
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y 16, 2023).
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| Business Concern

Regulatory Flexibili
aeve P. Carey, “The Regu
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ebrua
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Februa
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ssociated Press, “Reagan

y 18, 2023).

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16, 2021, https://crsreports.congress.gov/product/pdf/IF/IF

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US.
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(accessed February 16, 2023).
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istra
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ments of

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and Trade

Enforcement Act of 2015, Pu

-crimina

e of Limitation for Prosecuting PPP. E
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ion, “About SBA: Organization: SBA Hi
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y-act/ (accessed February 18,

em/|
023).
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atory Flexibility Act,”
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, “As Pandemic Aid Was Rushed
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DL Fraud,” Journal of Accountancy,
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October 12, 2022,

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11518, “Providing for the Increased Representation of the Interests
United States Government,” March 20,
21, 1970), pp. 4939-4940, https://tile.loc.gov/storage-services/
(accessed February 18, 2023).
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TATUTE-88/STATUTE-88-Pg742.pdf (accessed February 19, 2023).

ic Law No. 96-354, 96th Congress, September 19,
congress.gov/96/statute/STATUTE-94/STATUTE-94-Pg1164.pdf (accessed February 19, 2
onal Research Service /n Focus No. |F11900,
1900 (accessed February 18, 2023).

980, https://www.
023).

https://advocacy.sba.

30/STATUTE-130-Pg

/ (accessed March 2

4th Congress,
22.pdf (accessed

istration, Office of Advocacy, “Advocacy Releases Trade Report,” December 21, 2018,
ttos://advocacy.sba.gov/2018/12/21/advocacy-releases-trade-repor
Offers $994-Billion ‘Hard-Choices’ 1987 Budget,” Los Angeles Times,

y 5, 1986, http://\www.latimes.com/archives/la-xpm-1986-02-05-mn-4369-story.html (accessed

, 2023).

ness and

books?id=UwD-2|Ca8k8C&printsec=frontcover&source=gbs_ge_summary_r&cad=0#v=onepage&aq&f=false
(accessed February 18, 2023). See also Report No. 109-49, Summary of Legislative and Oversight Activities
During the 108th Congress, Committee on Small Business and Entrepreneurship, U.S. Senate, 109th Congress,
Ist Session, March 30, 2005, p. 21, https://www.congress.gov/109/crpt/srpt49/CRPT-109srpt49.pdf (accessed
February 18, 2023).

— 760 —

17.

18.

19.
20.

21.

22.

23.

24.

25.

26.

27.

28.

2025 Presidential Transition Project

ovember 18, 2022).
bid., p. 2. Emphasis added.
Press release, “SBA Announces End-o
Businesses

-Year Capi

small-businesses-under?utm_medium=email&u

https://www.usaspending.gov/agency/small-busi

Business and Entrepreneurship, U.S. Senate, 112th
govinfo.gov/content/pkg/CHRG-I12shrg88373/pd

Under Administrator Guzman,” U.S. Small Bus
www.sba.gov/article/2022/dec/13/sba-announces-

USASpending,gov, “Agency Profile: Small Business
Testimony and prepared statement of Tad DeHaven

Examination of SBA Programs: Eliminating Inefficiencies, Duplications, Fraud, and Abuse, Committee on Small
Conaress, 1s

tos

ness-admin

Editorial, “The Small Business Administration Needs Reforming,” The Washington Post, December 18, 2016,
httos://www.washingtonpost.com/opinions/the-sba-needs-reforming/2016/12/18/b639fc4c-c159-1le6-8422-
eac6lcOef74d_story.html (accessed February 18, 2023).
Robert Jay Dilger, Anthony A. Cilluffo, and R. Corinne Blackford, “Small Business Administration Funding:
Overview and Recent Trends,” Congressional Research Service Report for Members and Committees of
Congress No. R43486, updated July 14, 2022, Summary, h

‘//sap.fas.org/crs/misc/R43846.pdf (accessed

al Benchmarks Showing Historic Support for Small

iness Administration, December 13, 2022, https://
end-year-capital-benchmarks-showing-historic-support-
m_source=govdelivery (accessed February 18, 2023).
Administra

ion (SBA),” data through September 29, 2022,
strationefy=2022 (accessed February 18, 2023).

, Budget Analyst, Cato Institute, in hearing, An

Session, June 16, 2011, pp. 80-90, httos://www.

/CHRG-12shrg88373.pdf (accessed February 18, 2023).
Sarah Westwood, “Feds Gave $400 Million in Contracts to Ine

28, 2014, https://www.washingtonexaminer.com/
(accessed February 18, 2023).
Keith Girard, “Inside

eds-gave-400-mil

ligible Firms,” Washington Examiner, September

ion-in-contracts-to-ineligible-firms

he SBA’s Monumental Katrina Loan Scandal,” AllBusiness.com, https://www.allbusiness.

com/inside-the-sbas-monumental-katrina-loan-scandal-11793824-1.html (accessed February 18, 2023).

Arnold & Porter, “CARES Act
general/cares-act-
Jay Edwards, “Biparti
Fullest Extent of the

Fraud Tracker,” las

san Call to Crack Down on
Law,’ WRNJ Radio (Hacke

updated January 2,
raud-tracker (accessed February 18, 2023).

COVID-19 PPP/EIDL
tstown, New Jersey), October 21, 2022, https://wrnjradio.com/

2023, https://www.arnoldporter.com/en/

Fraud, Prosecute Fraudsters to the

bipartisan-call-to-crack-down-on-covid-19-ppp-eidl-fraud-prosecute-fraudsters-to-the-fullest-extent-of-the-

law/ (accessed March 21, 2023).
See, for example, H.
congress.gov/117/bil
In varying degrees,
with the SBA. During periods o
business community engages more
other mechanisms in the hope of warding off co
Administration can look to the following groups,
and broader policy reform: American Hotel and
Association; Association of Builders and Contrac
Distributors Association; Consumer Technology
Equipment Distributors Association; Heating, Ai
ndependent Bakers Associa
Contractors’ International Associati
etals Service Center Institute; Na
anufacturers; National Association of Wholesa
ational Marine Distributors Association; Nation
Concrete Association; National Small Business A
and U.S. Hispanic r of Commerce. Additi

on of Plas

policies that are intrusiveness or cos
like The Heritage Foundation, the Cato Ins
Government Waste, the

have a stake in an improved and cos

itute,

ion; Independent Commu
ics Di
ional Association o

R. 7628, IMPROVE the SBA Act, 117th Congress, introduced April 28, 2022, ht
s/hr7628/BILLS-117hr7628ih.pdf (accessed February 18, 2023).

almost every small-business advocacy organizati
hyper-regulatory activity fueled by
requently with th

Associ
r-cond

ation;

al Federatio
ssocia

761 —

e Office of Advocacy through its round
stly and intrusive ru
among others, for support in advancing both SBA
Lodging Association; Asian American
tors; Associated Equipment Distributors; Ceramic T

itioning, and Refrigeration Distri
nity Bankers Association; Independent
stributors; Interna
Electrical Dist
ler-Distributors; National Fastener Dis

ion; Small Busi
e€ onally, the sma
and several key groups strongly support SBA lendi
n y to business

ps://www.

on and trade association engages
an activist Administration, the small-
ables and

emakings. A future conservative

Hotel Owners
ile
ition; Foodservice
butors International;
Electrical
Association;
onal Association of
ributors Association;
Independent Business; National Ready Mix
ness and Entrepreneurship Council;
|-business community is diverse and broad,

Family Business Coal

ional Franchise
ibutors; Nati

pad

ng but vigorously oppose tax, regulatory, and spending
. Conservative thin
the National Taxpayers Union, Citizens Agains
Taxpayers Protection Alliance, and Americans for Tax Reform (among others) also
-effective SBA.

tanks and taxpayer organizations

29.

30.

Si.

32.

33.

34,

35.

56.

37.

38.

39.

or-faith

R-202

Cy Sr

ps://

President Joseph R. Biden
Federal Register, Vol. 86, No. 45 (March 10, 2021), p
-03-10/pdf/2021-05087.pdf (accessed February 19, 2023). See also press release, “Small Business
ommittee Republicans: The SBA Should Stay Out
usiness Committee Republicans, Committee on Sma
ouse.gov/news/documentsingle.asox?DocumentID=404061 (accessed

Mandate for Leadership:

U.S. Small Business Administration, “Ensuring Equa
and Disaster Assistance Programs,” Proposed Rule,
5036-5040, https://www.

epublicans-smallbusiness.h

rT = Oo

(a>)

ress rel

u U

america

bruary 18, 2023).

Goldman Sachs, 10,000 Small Busin
Reauthorize the SBA,” Open Letter to Congress, No

The Conservative Promise

| Treatment for Faith-Based Organizations in SBA’s Loan
Federal Register, Vol. 86, No. 11 January 19, 2021), pp.

ederalregister.gov/documents/2021/01/19/2021-00446/ensuring-equal-treatment-
-based-organizations-in-sbas-loan-and-disaster-assistance-programs (accessed February 18, 2023).
Jr, Executive Order 14019, “Promoting Access to Voting,” March 7, 2021, in

p. 13623-13627, https://Awww.govinfo.gov/content/pkg/

of Elections and Focus on Our Small Businesses,” Small
Business, U.S. House of Representatives, April 4, 2022,

ease, “SBA Administrator Guzman, Biden-Harris Administration Announce Community Navigator

nbanker.com/creditunions/news/sba-hasnt

ot Program Grantees,” U.S. Small Business Administration, October 28, 2021, https://www.sba.gov/

article/2021/oct/28/sba-administrator-guzman-biden-harris-administration-announce-community-navigator-
pilot-program (accessed February 18, 2023).
John Reosti, “SBA Hasn't Gi

ven Up on Direct Lending,” American Banker, May 2, 2022, https://www.

-given-up-on-direct-lending (accessed February 18, 2023).

esses Voices, “22 Years Is Too Long: Support Small Businesses.

vember 16, 2022, https://www.goldmansachs.com/

citizenship/10000-small-businesses/US/voices/reauthorize-the-sba-letter/index.html (accessed February 18,

2023). According to Goldm
of a broader campaign to priorit
signed by over 3,000 smal

an Sachs, the letter “was published in Politico on Wednesday, November 16 to kick
ize small businesses and modernize the SBA in the next Congress” and “was
business owners from all 50 states.” Ibid.

See, for example, “Challenge 3: SBA Faces Significant Challenges in IT Investment, System Development, and
Security Controls,” in U.S. Small Business Administration, Office of Inspector General, Joo Management and

Performance Challenges Facing the Small Business Administration in Fiscal Year 2023, Report 23-01, October
14, 2022, pp. 16-19, https://www.sba.gov/sites/default/files/2022-10/SBA%2001G%20Report%2023-01_0.pdf
(accessed February 18, 2023).

Ibid., p. i

Appendi

V.
x M, “Office of Advocacy’s Legislative Prior

ities,” and Appendix Q, “Memorandum of Understanding

Between the Small Business Administration and the Office of Advocacy,” in U.S. Small Business

Adminis
and 197,

Advocacy-2017-2020-web.pdf (accessed February
President Donald J. Trump, Executive Order 13771,

January
gov/con

https://cdn.advocacy.sba.gov/wp-content/

ent/pkg/FR-2017-02-03/pdf/2017-02451.p

J. Trump, Executive Order 13777, “Enforcing the Reg
Register, Vol. 82, No. 39 (March 1, 2017), pp. 12285-12287, https://www.govinfo.gov/content/pkg/FR-2017-03-
01/pdf/2017-04107.pdf (accessed February 19, 2023).

U.S. Small Business Administration, Office of Advocacy, What Small Businesses Are Saying and What
Advocacy Is Doing About It: Progress Report on the Office of Advocacy’s Regional Regulatory Reform
Roundtables, June 2017-September 2078, December 2018, https://cdn.advocacy.sba.gov/wp-content/
uploads/2018/12/20091536/What-Small-Businesses-Are-Saying-What-Advocacy-|s-Doing.pdf April 2020,
https://advocacy.sba.gov/regulatory-reform/ (accessed February 18, 2023December 10, 2022). See also U.S.
Small Business Administration, Office of Advocacy, Reforming Regulations and Listening to Small Business:
Second Progress Report on the Office of Advocacy’s Regional Regulatory Roundtables, June 2017-December
2019, https://cdn.advocacy.sba.gov/wp-content/uploads/2020/04/20141200/2nd-Progress-Report-on-Reg-
Reform-Roundtables.pdf (accessed February 18, 2023).

—7

ration, Office of Advocacy, Background Paper, Office of Advocacy, 2017-2020, January 2021, pp. 192

ploads/2021/02/09101916/Background-Paper-Office-of-
8, 2023).

“Reducing Regulation and Controlling Regulatory Costs,”
30, 2017, in Federal Register, Vol. 82, No. 22 (February 3, 2017), pp. 9339-9341, https://www.govinfo.

df (accessed February 19, 2023), and President Donald
ulatory Reform Agenda,” February 24, 2017, in Federal

62 —

40.

Al.

42.

43.

AA.

AS.

46.

47.

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he Acting General Counsel,
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February 18, 2023).

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(accessed February 18, 2023).

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(accessed February 18, 2023).
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anagement, Programs, Resources, and Oversigh
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uring Act, 117th Congress, introduced

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arch

or Vi

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LLS-117s403is.pdf (accessed February 19, 2023), and H.R. 1284, Fair and Open
ition Act, 117th Congress, introduced February 24, 2021, https://www.congress.gov/117/bills/hr1284/

BILLS-117hr1284ih.pdf (accessed February 19, 2023.

Preside

Construction Projects,” February 4, 2022, in Federal Register, Vol. 87,
7363-7366, https://www.govinfo.gov/content/pkg/FR-2022-02-09/pd
February 19, 2023).

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February 19, 2023).

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REC-2020-07-27-ptl-PgS4491-7.pdf (accessed February 20, 2023).

25, 2021, https://

s/s1059/BILLS-117s1059is.pdf

al Entrepreneurs)

v/117/bills/hr7628/BILLS-

ced April 10, 2019,

19, 2023).
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ubll2

th Congress,
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tos://www.

nt Joseph R. Biden Jr., Executive Order 14063, “Use of Project Labor Agreements for Federal
0. 27 (February 9, 2022), pp.
f/2022-02869.pdf (accessed

ing, and Urban Affairs, U.S. Senate,
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o Expand Number of Small Business

TRADE

THE CASE FOR FAIR TRADE

Peter Navarro

For decades the world has struggled with a shifting maze of punitive tariffs,
export subsidies, quotas, dollar-locked currencies, and the like. Many

of these import-inhibiting and export-encouraging devices have long

been employed by major exporting countries trying to amass ever larger
[trade] surpluses.

Warren Buffett, CEO, Berkshire Hathaway!

The Chinese government is implementing a comprehensive, long-term
industrial strategy to ensure its global dominance.... Beijing’s ultimate goal
is for domestic companies to replace foreign companies as designers and
manufacturers of key technology and products first at home, then abroad.

U.S.-China Economic and Security Review Commission?

The United States of America is the world’s dominant superpower and remains
the world’s arsenal of democracy. To maintain that global positioning—and thereby
best protect the homeland and our own democratic institutions—it is critical that
the United States strengthen its manufacturing and defense industrial base at the
same time that it increases the reliability and resilience of its globally dispersed

— 765 —

Mandate for Leadership: The Conservative Promise

supply chains. That will necessarily require the onshoring ofa significant portion
of production currently offshored by American multinational corporations.

Trade policy can and must play an essential role in an American manufacturing
and defense industrial base renaissance. However, several major challenges in the
international trading environment are pushing America in the opposite direction.

The first challenge is rooted in MFN: the “most favored nation” rule of the World
Trade Organization (WTO). According to the MFN rule, WTO members must apply
the lowest tariffs that they apply to the products of any one country to the products
of every other country.® However, WTO members can charge higher tariffs if they
apply these nonreciprocal tariffs to all countries.

The practical result has been the systematic exploitation of American farmers,
ranchers, manufacturers, and workers through higher tariffs institutionalized by
MEN. In turn, this unfair and nonreciprocal trade has resulted in chronic U.S. trade
deficits with much of the rest of the world. This systemic trade imbalance serves as
a brake and bridle on both GDP growth and real wages in the American economy
while encumbering the U.S. with significant foreign debt.

The second challenge is part of the broader existential threat posed by the
Chinese Communist Party (CCP) in its quest for global dominance. That chal-
lenge is rooted in the CCP’s continued economic aggression, which begins with
mercantilist and protectionist trade policy tools such as tariffs, nontariff barriers,
dumping, counterfeiting and piracy, and currency manipulation. However, Com-
munist China’s economic aggression also extends to an intricate set of industrial
policies and technology transfer-forcing policies that have dramatically skewed
the international trading arena.

Both the unfair, unbalanced, and nonreciprocal trade institutionalized by the
WTO and Communist China’s economic aggression are weakening America’s man-
ufacturing and defense industrial base even as the fragility of globally dispersed
supply chains has been brought into sharp relief by the COVID-19 pandemic with
its associated lockdowns and other disruptions and by the Russian invasion of
Ukraine. Russian revanchism, in particular, has demonstrated once again how bad
actors on the world stage can use trade policy (for example, export restraints on
natural gas) as a weapon of war.

LAYING THE TRADE DEFICIT PREDICATE

The great football coach Bill Parcells once said, “You are what your record says
you are.” America’s record on trade—specifically American’s chronic and ever-ex-
panding trade deficit—says that America is the globe’s biggest trade loser and a
victim of unfair, unbalanced, and nonreciprocal trade.

During the first year of the Biden Administration, the overall U.S. trade defi-
cit, including goods and services, soared by 29 percent, from $654 billion in 2020
to $845 billion in 2021.* Over the same time period, imports of consumer goods,

— 766 —

2025 Presidential Transition Project

TABLE 1

America’s Trade Deficit in Goods and Services
with Major Trading Partners

FY 2022 FIGURES FOR SELECTED AREAS, IN BILLIONS OF DOLLARS

Country Deficit Country Deficit
Communist China -338.1 South Korea -35.6
European Union -192.6 Thailand -36.6
Mexico -108.2 India -33.8
Vietnam -99.8 Malaysia -30.9
Canada -72.4 Switzerland -19.0
Japan -55.0 Indonesia -21.1
lreland -54.6 Total -1,138.0
Taiwan -41.1

SOURCE: Exhibit 14, “U.S. Trade in Goods by Selected Countries and Areas: 2022,” in press release, “Monthly U.S.
International Trade in Goods and Services, October 2022,” U.S. Department of Commerce, U.S. Census Bureau,
December 6, 2022, https://www.census.gov/foreign-trade/Press-Release/ft900/ft900_2210.pdf (accessed
March 21, 2023).

& heritage.org

capital goods, and the category of foods, feeds, and beverages were the highest on
record, and imports of industrial supplies and materials were the highest since 2014.

As for the US. trade deficit in goods, which primarily measures manufacturing
output, Table 1 catalogues that deficit for the top 13 countries plus the European
Union (EU) in fiscal year (FY) 2022. Note that the trade deficit in goods with Com-
munist China is by far the largest: It accounts for fully one-third of that deficit and
is more than twice the size of the deficit with the EU.

These trade deficit statistics implicitly measure the large amounts of Ameri-
ca’s manufacturing and defense industrial base and supply chains that have been
offshored to foreign lands. Such offshoring not only suppresses the real wages of
American blue-collar workers and denies millions of Americans the opportunity
to climb up the rungs of the ladder to the middle class, but also raises the specter of
a manufacturing and defense industrial base that, unlike our experience in World
Wars | and II, will not be able to provide the weapons and matériel that would be
needed should America enter another major world war or seek to assist a major ally
like Europe, Japan, or Taiwan. It is wise to recall Stalin’s admonition that “quantity

— 767 —

Mandate for Leadership: The Conservative Promise

has a quality of its own.” In World War II in particular, it was not just the brave
soldiers, sailors, and pilots who beat the Nazis and Imperial Japan. It was America’s
factories—its “arsenal of democracy”—that overwhelmed the Axis forces.

In the wake of the COVID-19 pandemic, almost certainly spawned in a CCP
biological weapons lab in Wuhan, China,” global supply chains have been under
significant pressures from lockdown policies, energy price shocks, and other dis-
ruptions, including labor market disruptions. At the height of the pandemic, the
rising geopolitical risk associated with globalized supply chains was underscored
when Communist China, which controls much of the world’s pharmaceutical pro-
duction and supply chains, threatened to plunge America “into a mighty sea of
coronavirus” through pharmaceutical export controls° if American politicians
dared to investigate what happened at the Wuhan lab.

Add all this up, and America’s trade situation and massive trade imbalances
pose not only asevere economic security threat, but also a national security threat.
As President Donald Trump indicated in announcing his 2017 National Security
Strategy, “economic security is national security.””

CHALLENGE #1: UNFAIR AND NONRECIPROCAL
TRADE INSTITUTIONALIZED IN WTO RULES

Tonight, Iam also asking you to pass the United States Reciprocal Trade
Act, so that if another country places an unfair tariff on an American product,
we can charge them the exact same tariff on the exact same product that

they sell to us.

President Donald J. Trump, 2019 State of the Union Address®

The World Trade Organization, with its 164 members, governs international
trade rules. Under its most favored nation (MFN) rule, each WTO member must
apply the lowest tariffs it applies to the products of any one country to the products
of every other WTO country. Importantly, nothing in the MFN rule requires a WTO
member to provide equal—that is, reciprocal or mirror—tariff rates to its trading
partners. Rather, under MFN, WTO members can charge systematically higher
tariffs to other countries to the extent negotiated in their WTO tariff schedules
so long as they apply those same higher tariffs to all countries.

As a poster child for the kind of nonreciprocal tariffs that American manufactur-
ers often face, the MFN tariff for automobiles applied by the U.S. is only 2.5 percent.
In contrast, the EU charges 10 percent, Communist China 15 percent, and Brazil 35
percent. Similarly, while the U.S. applies an MFN tariff rate of 6.2 percent on the
rice it buys from Malaysia, Malaysia applies an ad-valorem equivalent tariff of 40
percent on rice from the U.S. Meanwhile, European milk producers are shielded

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2025 Presidential Transition Project

TABLE 2

Nonreciprocal Tariff Rates Under “Most Favored Nation” Rule

Foreign U.S. and Foreign
Partner Applies U.S. Applies Partner Apply
132-Country Sample Higher Tariff Higher Tariff Same Tariff
Number of HS6 Product Lines 467,015 141,736 87,319
Percent of HS6 Product Lines 67% 20% 13%
Tariff Differential 12.3% 8.7% 0.0%

NOTE: HS6—Harmonized Commodity Description and Coding System.
SOURCE: United Nations Conference on Trade and Development, “Trade Analysis Information System,” https://
databank.worldbank.org/source/unctad-%5E-trade-analysis-information-system-(trains) (accessed March 21, 2023).

& heritage.org

by 67 percent tariffs while American milk producers benefit only from a 15 percent
tariff on foreign imports.’

From the perspective of strategic game theory, the WTO’s MFN rule provides
little or no incentive for higher-tariff countries to lower their tariffs. Rather, under
these conditions, the dominant strategy of any relatively high-tariff country is
simply to maintain those high tariffs while free riding off the lower-tariff countries.

The USS. is disproportionately harmed by the WTO’s nonreciprocal tariff regime.
The countries that are hurt most by the WTO’s nonreciprocal tariff regime are
those like the United States that charge the lowest tariffs on average. This point is
illustrated in Table 2, which reports information on nonreciprocal tariffs that are
applied under the MFN rule on product lines at the six-digit level of the Harmo-
nized Commodity Description and Coding System (HS6).’°

Table 2 presents results for a broad sample of 132 countries that account for
more than 60 percent of total U.S. trade and 98 percent of U.S. trade that is not cov-
ered by free trade agreements (FTAs). Within this broad sample of 132 countries,
U.S. exporters face higher tariffs in 467,015 different cases compared to 141,736
cases in which the U.S. charges higher nonreciprocal rates. In other words, U.S.
exporters face higher tariffs more than three times as often as the U.S. applies
higher tariffs.

Moreover, when American exporters face higher tariffs, the nonreciprocal tar-
iffs are typically much higher. As row 4 of Table 2 indicates, in the 467,015 cases in
which foreign partners charge higher tariffs, the average rate applied by the foreign
partners is 12.3 percentage points above the rate applied by the U.S. In contrast,

— 769 —

Mandate for Leadership: The Conservative Promise

in the 141,736 cases in which the U.S. charges the higher tariff, the average US.
applied rate is only 8.7 percentage points higher than the average applied tariff of
the foreign partner.

Separately, Communist China levies higher tariffs on 10 products for every
one Chinese product that is subject to a U.S.-applied higher tariff." India’s ratio is
even higher at 13 to one. Further, both Communist China and India also feature
significant nontariff barriers. Collectively, these higher nonreciprocal tariffs in
Communist China and India block American exporters from selling goods at com-
petitive prices to more than one-third of the world’s population.

Trade Deficit Impacts of the U.S. Reciprocal Trade Act. Under current
United States laws and regulations, an American President has limited ability
to fight back against the higher MFN tariffs now being levied against American
workers, farmers, ranchers, and manufacturers. Accordingly, behind the WTO’s
protective MFN shield, America’s free-riding trading partners have little or no
incentive to come to the bargaining table to negotiate lower tariffs.

To address this nonreciprocity stalemate, President Trump urged Congress in
his 2019 State of the Union address to pass the United States Reciprocal Trade Act
(USRTA).” Under the USRTA, the President would have the authority to bring any
American trading partner that is currently applying higher nonreciprocal tariffs to
the negotiating table. If that trading partner refused to lower tariffs to U.S. levels,
the President then would have the authority to raise U.S. tariffs to match or “mirror”
the foreign partner’s tariffs.

The USRTA was introduced on January 24, 2019, by then-Representative Sean
Duffy (R-WD. The following month, a Harvard-Harris poll of 1,792 registered
voters found that 80 percent of respondents supported the USRTA." As Repre-
sentative Duffy noted at the time, the purpose of granting the President these
authorities was not to raise tariffs. Rather, it was to give the President, working in
close consultation with Congress, a sophisticated and targeted tool that he could
use to force other countries to lower their tariffs and nontariff barriers."*

Following the introduction of the USRTA, the White House Office of Trade and
Manufacturing Policy (which the author directed) ran simulations to estimate the
impact that implementation of the USRTA might have on the overall U.S. trade
deficit in goods and the large bilateral trade deficits the U.S. runs with many of its
major trading partners. The sample consisted of the same 132 trading partners used
in Table 2 above." The results underscore the unfair and unbalanced nonreciprocal
trade the U.S. is forced to accept under WTO MFN rules.

Two Scenarios. Scenario One in Table 3 assumes that our trading partners
lower their applied tariff rates on specific products to U.S. levels in cases where
their applied tariffs are higher. Scenario Two assumes that our trading partners
refuse to lower their tariff rates to match those of the U.S. Instead, in order to
uphold the principle of reciprocity, the U.S. raises its tariffs to mirror levels. To

— 770 —

2025 Presidential Transition Project

TABLE 3

Trade Deficit Reductions Under Alternative USRTA Scenarios

REDUCTION IN U.S. TRADE DEFICIT WITH WORLD

Scenario One: Scenario Two:
Partner Countries U.S. Matches Partner
Metric Match U.S. Tariff Rate Tariff Rates
In Billions of Dollars $58.3 $63.6
As Percentage of 2018 Deficit 9.4% 10.2%

NOTE: USRTA—US. Reciprocal Trade Act.

SOURCE: White House Office of Trade and Manufacturing Policy, The United States Reciprocal Trade Act: Estimated
Job & Trade Deficit Effects, May 2029, p. 18, https://www.wsj.com/public/resources/documents/RTAReport.
pdf?mod=article_inline (accessed March 21, 2023).

& heritage.org

calculate the trade deficit reductions under Scenario One and Scenario Two, the
analysis relied on the World Bank’s SMART tariff simulator. Table 3 provides the
simulation results.

In Scenario One, if all 132 countries were to lower their higher nonreciprocal
tariffs to U.S. levels, the overall U.S. trade deficit in goods would be reduced by
$58.3 billion, or about 9.4 percent of that deficit. In contrast, in Scenario Two, if
these countries were to refuse to reciprocate and the U.S. were to raise its tariffs
to mirror those countries’ levels, the reduction in the U.S. trade deficit would
be slightly larger: an estimated $63.6 billion, or 10.2 percent of the deficit. This
suggests that implementing the USRTA would help to create between 350,000
and 380,000 jobs.

The slightly larger reduction in the trade deficit in Scenario Two as a result
of the US. raising its tariffs to mirror those of its partners, as opposed to foreign
countries lowering their tariffs to U.S. levels, may seem surprising to those who are
steeped in Ricardian dogma and the textbook lessons of free trade. However, this
result speaks to the fact that so many of America’s trading partners are applying
significantly higher tariffs to thousands of American products.

Estimated Impacts on Key U.S. Bilateral Trade Deficits. If the USRTA were
enacted, a President would likely have to prioritize which countries he should
negotiate with first. One way to create such a priority list would be to choose those
countries that have relatively large trade deficits with the U.S. and apply relatively
high tariffs. This is illustrated in Figure 1, which maps bilateral trade deficits

—-771—

Mandate for Leadership: The Conservative Promise

FIGURE 1

Mapping Bilateral Trade Deficits Against Tariff Differentials

® Largest bilateral trade deficit and/or largest tariff differential
Second-to-largest bilateral trade deficit and/or second-to-largest bilateral tariff differential
@ Smallest bilateral trade deficit and/or smallest tariff differential

AVERAGE MOST-FREE-NATION DIFFERENTIAL, SIMPLE MEAN
10%

Thailand
Taiwan

Vietnam

0 $50 $100 $150 $200 $250 $300 $350 $400 $450
BILATERAL TRADE DEFICIT, 2018, IN BILLIONS OF U.S. DOLLARS

SOURCE: White House Office of Trade and Manufacturing Policy, The United States Reciprocal Trade Act: Estimated
Job & Trade Deficit Effects, May 2019, p. 20, https:/Awww.wsj.com/public/resources/documents/RTAReport.pdf?
mod=article_inline (accessed March 21, 2023).

@ heritage.org

against tariff differentials for eight major U.S. trading partners, which account for
47.6 percent of total U.S. trade and 88.6 percent of the U.S. trade deficit in goods.

Figure 1 shows that the USRTA priority list would include the countries in
red—Communist China and India—along with trading partners in the yellow zone.
This yellow zone includes the European Union, which features a very high deficit,
along with Thailand, Taiwan, and Vietnam, which feature particularly high tariff
differentials.

Table 4 estimates the improvement in the U.S. trade deficit under Scenario
One, in which partner countries match the U.S. tariff rate under pressure from

— 772 —

TABLE 4

2025 Presidential Transition Project

Trade Deficit Reductions for Target Countries

SCENARIO ONE: SCENARIO TWO:
PARTNER COUNTRIES U.S. MATCHES PARTNER
MATCH U.S. TARIFF RATE TARIFF RATES
Bilateral Bilateral
Projected Deficit Projected Deficit
Change in Reduction Change in Reduction
Bilateral Trade _as Share of Bilateral Trade _as Share of
Balance 2018 Bilateral Balance 2018 Bilateral
Country ($ Billions) Deficit ($ Billions) Deficit
India 5.0 24% 18.7 88%
Taiwan 1.0 6% 9.2 59%
Vietnam 0.7 2% 17.2 44%
Thailand 3.2 17% 6.4 34%
Communist China 18.5 4% 70.6 17%
European Union 8.0 5% 25.3 15%
Total 35.4 4% 45.6 5%

SOURCE: White House Office of Trade and Manufacturing Policy, The United States Reciprocal Trade Act: Estimated
Job & Trade Deficit Effects, May 2029, p. 21, https://www.wsj.com/public/resources/documents/RTAReport.
pdf?mod=article_inline (accessed March 21, 2023).

& heritage.org

the American President, and then under Scenario Two, in which the U.S. matches

the tariffs of partners that refuse to lower their tariffs. Columns 2 and 4 in Table 4,
when the USRTA is applied first to Communist China and then to the EU, show the

largest absolute dollar reductions in bilateral trade deficits. This results in bilat-
eral deficit reductions in Scenario One of $18.5 billion for China and $8.0 billion

for the EU. In Scenario Two, the impacts for Communist China and the EU are

substantially larger: $70.6 billion and $25.3 billion, respectively.

Note further that the largest relative dollar reductions in percent terms come
from applying the USRTA first to India and then to Taiwan and Vietnam. For exam-
ple, if India were to reduce its tariffs to U.S. levels, as in Scenario One, this would
reduce the bilateral trade deficit with India by 24 percent. If the U.S. raised its
tariffs to mirror India’s levels, the result would be a far more dramatic 88 percent

— 773 —

: The Conservative Promise

Mandate for Leadership

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2025 Presidential Transition Project

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— 775 —

: The Conservative Promise

Mandate for Leadership

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— 776 —

2025 Presidential Transition Project

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— 777 —

: The Conservative Promise

Mandate for Leadership

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— 778 —

2025 Presidential Transition Project

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— 779 —

: The Conservative Promise

Mandate for Leadership

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— 780 —

2025 Presidential Transition Project

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S a1avl

— 781 —

Mandate for Leadership: The Conservative Promise

reduction in the US. bilateral trade deficit with India. Similarly, if Taiwan were to
reduce its tariffs to U.S. levels, the size of the U.S. bilateral trade deficit with Taiwan
would fall by 6 percent. If the U.S. imposed a mirror tariff, its bilateral trade deficit
with Taiwan would fall by 59 percent.

These results again underscore the high degree of unfair, unbalanced, and
nonreciprocal trade that currently exists between the U.S. and much of the rest
of the world, which penalizes American farmers, ranchers, manufacturers, and
workers because of the WTO-MFN conundrum. These simulations also demon-
strate that implementation of the USRTA most likely would substantially reduce
the US. trade deficit while creating hundreds of thousands of new jobs. These
benefits notwithstanding, however, the U.S. would still face a substantial over-
all trade deficit and substantial bilateral trade deficits with many of its major
trading partners.

Why might this be so? Because under WTO rules, America still faces numerous
nonreciprocal nontariff barriers around the world. For example, one of America’s
largest trading partners, Japan, runs a significant bilateral trade surplus in goods
with the U.S.—more than $70 billion a year. While Japan has relatively low tariffs,
it ranks high on the nontariff barrier scale. In such cases, which are numerous, pas-
sage of the USRTA would likely also be very helpful in reducing nontariff barriers.

This is because under the powers provided by the USRTA, if a foreign country
imposes significantly higher nontariff barriers, then the President has the authority
to “negotiate and seek to enter into an agreement” that “commits the country to...
eliminate [its] nontariff barriers.”!° If the country refuses to come to the negoti-
ating table and lower its nontariff barriers, the President has the authority to levy
reciprocal duties to offset or mirror those barriers.

In summary, passage of the USRTA would go a long way toward leveling the
playing field for American farmers, ranchers, manufacturers, and workers who are
now forced to compete in an intrinsically unfair, unbalanced, and nonreciprocal
WTO-MEN system.

Nor is the USRTA necessarily the only possible legislative way to address this
issue. In 2017, then-House Speaker Paul Ryan (R-WI) and then-House Ways and
Means Committee Chairman Kevin Brady (R-TX) proposed a “border adjust-
ment tax.” The proposed border adjustment would have eliminated the ability of
corporations to deduct the cost of imports while eliminating the tax on income
attributable to exports. This border adjustment tax would have shifted the U.S.
corporate income tax from an origin-based tax applying to the production of goods
and services in the United States to a destination-based tax applying to the con-
sumption of goods and services in the US.

This tax—strongly opposed by American multinational corporations and big-
box retailers—not only would have leveled the playing field with respect to WTO
rules, but also would have provided an innovative alternative to the application of

— 782 —

2025 Presidential Transition Project

tariffs.’ A conservative Administration might do well to look at such a tax as part
of its trade agenda.

CHALLENGE #2: COMMUNIST CHINA’S ECONOMIC
AGGRESSION AND QUEST FOR WORLD DOMINATION®

Among all of its bilateral trade relationships, America’s relationship with Com-
munist China is the most fraught with difficulty. The problem is not just that the
relentlessly mercantilist and protectionist trade policies that China has pursued
ever since its accession to the WTO in 2001 have led to chronic, massive, and
ever-expanding trade deficits. Communist China’s economic aggression in the
traditional trade policy space is further facilitated by equally aggressive industrial
policies and technology transfer—forcing policies that are designed to shift the
world’s manufacturing and supply chains to Communist Chinese soil.

The Chinese Communist Party’s policy goal is to propel the Chinese economy,
but its broader goal is to strengthen Communist China’s defense industrial base
and associated warfighting capabilities. That China unabashedly seeks to supplant
America as the world’s dominant economic and military power is not in dispute.
Rather, itis a prominent feature of Communist Chinese dictator Xi Jinping’s rhet-
oric. Xi has promised that the deed will be done by 2049, the 100-year anniversary
of the Communist takeover of the Mainland.”

In light of Communist China’s broader geopolitical and military agenda, the
American President who takes office in January 2025 must view the U.S.-China
trade relationship and associated policy reforms within the context of the broader
existential threat posed by Communist China. The question is whether that next
President should seek to decouple economically and financially from Communist
China as America’s first best response to China’s unrelenting aggression or con-
tinue efforts to negotiate with an authoritarian country and brutal dictatorship
with a well-established reputation for failing to abide by any agreements it enters.

Institutionalized Aggression. Table 5 depicts more than 50 types of policy
aggression institutionalized by the CCP across six different categories of such
aggression. Viewed as whole, the extent of Communist China’s aggression is
breathtaking.

At the trade policy level, Communist China relies heavily on a wide range of
mercantilist and protectionist tools to protect its own markets and unfairly exploit
foreign markets. These instruments of Communist Chinese trade aggression
include high tariffs and nontariff barriers, currency manipulation, a heavy reli-
ance on sweatshop labor and pollution havens, the dumping of unfairly subsidized
exports, and widespread counterfeiting and piracy: Communist China is the world’s
largest source of counterfeit and pirated products.

In addition, Communist Chinese enterprises benefit from preferential policies
that have burdened world markets with subsidized overcapacity. The resultant glut

— 783 —

Mandate for Leadership: The Conservative Promise

of Communist Chinese exports in turn depresses world prices and pushes foreign
rivals out of the global market—steel is a major example.”° Industrial policy tools
that further reinforce Communist China’s mercantilist and protectionist trade
policies include numerous direct and indirect subsidies to boost exports and the
consolidation of heavily subsidized state-owned enterprises into “national champi-
ons” that can compete with foreign companies in both domestic and global markets.

Communist China also uses a predatory “debt trap” model of economic develop-
ment aid that proffers substantial financing to developing countries in exchange for
their willingness to mortgage their natural resources and allow Communist China
access to their markets. The practical effect of this debt trap model is to give Com-
munist China a competitive edge internationally that stems from its preferential
access to relatively lower-cost commodities needed in the manufacturing process.
These commodities range from bauxite, copper, and nickel to rarer commodities
such as beryllium, titanium, and rare earth minerals.

As acomplement to this debt trap gambit and to exploit its commanding share
of a wide range of critical raw materials that are essential to the global supply
chain and production of high-technology and high-value-added products, Com-
munist China strategically uses protectionist export restraints, including export
quotas and export duties. These export restraints thereby restrict access to raw
materials such as rare earth, tungsten, and molybdenum that are essential in
the high-technology production space. The result is to drive up world prices and
thereby put pressure on American and other foreign downstream producers to
move their operations, technologies, and jobs to Communist China. American
industries that have been affected by Communist China’s export restraints range
from steel, chemicals, and electric cars to wind turbines, lasers, semiconductors,
and refrigerants.

Technology-Forcing Policies. Table 6, extracted from the White House Office
of Trade and Manufacturing Policy’s report on Communist China’s economic
aggression,” provides a summary of the various policies the Chinese Communist
Party uses to force the transfer of the West’s technologies to Communist Chinese
soil. Formally, Communist Chinese industrial policy seeks to promote the “diges-
tion, absorption, and re-innovation” of technologies and intellectual property (IP)
from around the world.”

As noted in Table 6, this policy is carried out, for example, through state-spon-
sored IP theft—coercive and intrusive regulatory gambits to force technology
transfer, typically in exchange for limited access to the Chinese market. Commu-
nist China’s looting of American technology is further enhanced by “information
harvesting” conducted by Communist Chinese nationals who infiltrate U.S. uni-
versities, national laboratories, and other centers of innovation. Strategic sectors
targeted by Communist Chinese economic espionage have included electronics,
telecommunications, robotics, data services, pharmaceuticals, mobile phone

— 784 —

2025 Presidential Transition Project

services, satellite communications and imagery, and business application software.
It has been estimated that the theft of trade secrets alone costs the U.S. “between
$180 billion and $540 billion” annually.”*

Closely related to Communist China’s espionage campaigns are its state-backed
efforts to evade U.S. export control laws. These laws are designed to prevent the
export of sensitive technologies with military applications.”* However, a significant
problem facing agencies like the Departments of Commerce, Defense, and State is
the growth of “dual-use” technologies, which have both military and civilian utility.
For example, airplane engine technologies have an obvious commercial application.
When acquired by a strategic economic and military competitor like Communist
China, however, such commercial items can quickly wind up propelling the aircraft
of the People’s Liberation Army.

As an example of Communist China’s coercive and intrusive regulatory gambits
to force the transfer of foreign technologies and IP to Chinese competitors, foreign
companies often must enter into joint ventures or partnerships with minority
stakes in exchange for access to the Chinese market. Once a U.S. or foreign company
is coerced into entering a joint venture with a Chinese partner, the door is open
to the transfer of technology and IP. Similarly, a relentlessly coercive Communist
China has forced American patent and technology holders to accept below-market
royalty rates in licensing and other forms of below-market compensation for their
technologies—and the American government has done little or nothing about it.

Information Harvesting. Every year, more than 300,000 Communist Chi-
nese nationals attend U.S. universities or are hired at U.S. national laboratories,
innovation centers, incubators, and think tanks. To put this in perspective, accord-
ing to the Chinese Ministry of Education, only 20,000 American nationals were
studying abroad at Chinese universities on the mainland in 2018.”° These Chinese
nationals—often members (or the sons and daughters of members) of the Chinese
Communist Party—now account for approximately one-third of foreign university
and college students in the United States and about 25 percent of graduate students
specializing in science, technology, engineering, or math (STEM).”° As a Defense
Innovation Unit Experimental (DIUx) report has warned:

Academia is an opportune environment for learning about science and
technology since the cultural values of U.S. educational institutions reflect an
open and free exchange of ideas. As a result, Chinese science and engineering
students frequently master technologies that later become critical to key
military systems, amounting over time to unintentional violations of U.S.
export control laws.?’

State-backed Chinese enterprises also increasingly finance joint research
programs and the construction of new research facilities on U.S. campuses. For

— 785 —

Mandate for Leadership: The Conservative Promise

example, Huawei, well-known within the American intelligence community as an
instrument of Chinese military espionage, has partnered with the University of
California—Berkeley on research that focuses on artificial intelligence and related
areas such as deep learning, reinforcement learning, machine learning, natural
language processing, and computer vision, all of which have important future mil-
itary applications.” In this way, UC-Berkeley, whether unwittingly or wittingly,
helps to boost Communist China’s capabilities and quest for military dominance.
Communist Chinese state actors are also strategically building research cen-
ters in innovation centers and hubs like Silicon Valley and Boston. Such American
research has accelerated Communist China’s development of hypersonic glide
vehicles, which travel at speeds in excess of Mach 5 and are aimed at evading
modern ballistic missile defense systems while they deliver their nuclear weapons.
Technology-Seeking, State-Financed Foreign Direct Investment (FDI).
If American entrepreneurs build it, Communist Chinese investors will come. And
come they have in droves. In the words of the United States Trade Representative:

The Chinese government directs and unfairly facilitates the systematic
investment in, and acquisition of, U.S. companies and assets by Chinese
companies, to obtain cutting-edge technologies and intellectual property and
generate large-scale technology transfer in industries deemed important by

state industrial plans.”

Communist Chinese buyers have included most prominently state-owned
enterprises, private Chinese companies with interlocking ties to the Commu-
nist Chinese state, and state-backed sovereign wealth funds. These agents of the
Communist Chinese government push their foreign direct investment through
vehicles that include mergers and acquisitions, seed and venture capital financing,
and greenfield investing, particularly in strategically targeted high-technology
industries. Since 2012, CB Insights has catalogued more than 600 high-technology
investments in the United States worth close to $20 billion—with artificial intelli-
gence, augmented and virtual reality, and robotics receiving a particular focus—by
Communist China-based investors.*°

All of these behaviors raise the question of whether Communist Chinese nation-
als should be granted visas to penetrate our universities, think tanks, and research
institutions and whether Communist Chinese capital should be allowed to invest
in America’s cutting-edge technology firms.

Policy Responses to Communist Chinese Aggression. It should be clear
from this review that Communist China’s economic aggression is both widespread
and systemic. The CCP’s self-proclaimed goal is to supplant the U.S. as the world’s
dominant economic and military superpower. The question: How should the next
American President address this aggression? Policy responses range from further

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attempts to negotiate with the CCP to strategically decoupling economically and
financially from Communist China.

The Fruitlessness of Further Negotiations. If the past is prologue, and as
we learned during the Trump Administration, any further negotiations with Com-
munist China are likely to be both fruitless and dangerous: fruitless because the
CCP now has a very well-established reputation for bargaining in bad faith and
dangerous because as long as the CCP’s aggression continues, it will further weaken
America’s manufacturing and defense industrial base and global supply chains.

The record regarding Communist China’s bad-faith negotiating is clear. In
September 2015, President Barack Obama stood with Xi Jinping in the White
House Rose Garden where Xi solemnly promised not to militarize the South
China Sea and agreed that Communist China would not conduct knowingly
cyber-enabled theft of intellectual property.*! Within a year, the first promise
would be broken.*? As for Communist China’s cyberattacks on American busi-
nesses, they have never stopped.

Upon taking office in 2017, President Trump put on hold his 2016 campaign
promise to put high tariffs on Chinese products immediately. Instead, as a gesture
of good faith, he sought to negotiate a comprehensive trade agreement with China
that would have addressed many of the issues raised in this discussion.

By the middle of 2018, it was clear that the CCP had no intention of bargaining
in good faith. As a result, on June 15, President Trump began to impose a series of
tariffs*? on Chinese products that would eventually rise to cover more than $500
billion of Chinese imports. These tariffs would lead Communist China’s lead nego-
tiator, Vice Premier Liu He, to agree tentatively in April of 2019 to what would
have been the most comprehensive trade deal in global history.** On May 8, 2019,
however, Liu would renege on that 150-page deal and seek its drastic re-trading.*

Finally, on January 15, 2020, the U.S. and Communist China signed a “Phase
One” deal that was a pale shadow of the original deal.*° This so-called Skinny Deal
(as it was derisively and rightly called) combined proposed modest Communist
Chinese reforms on issues related to forced technology transfer and intellectual
property theft with promises of large-scale purchases of agricultural, manufactur-
ing, and energy products. To date, this deal has been a predictable bust: Communist
China has failed to consummate a significant fraction of its promised purchases
and has made little or no progress on reforming its mercantilist, protectionist, and
technology transfer-forcing policies.

The clear lesson learned in both the Obama and Trump Administrations is that
Communist China will never bargain in good faith with the U.S. to stop its aggres-
sion. An equally clear lesson learned by President Trump, which he was ready to
implement in a second term, was that the better policy option was to decouple
both economically and financially from Communist China as further negotiations
would indeed be both fruitless and dangerous.

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TABLE 6

Vectors of Communist China’s Economic Aggression in the
Technology and IP Space

1. Physical Theft and Cyber-Enabled Theft of Technologies and IP
* Physical Theft of Technologies and IP Through Economic Espionage
* Cyber-Enabled Espionage and Theft
¢ Evasion of U.S. Export Control Laws
* Counterfeiting and Piracy
¢ Reverse Engineering
2. Coercive and Intrusive Regulatory Gambits
* Foreign Ownership Restrictions
¢ Adverse Administrative Approvals and Licensing Requirements
¢ Discriminatory Patent and Other IP Rights Restrictions
¢ Security Reviews Force Technology and IP Transfers
¢ Secure and Controllable Technology Standards
* Data Localization Mandates
¢ Burdensome and Intrusive Testing
* Discriminatory Catalogues and Lists
¢ Government Procurement Restrictions
* Indigenous Technology Standards that Deviate from International Norms
* Forced Research and Development
¢ Antimonopoly Law Extortion
* Expert Review Panels Force Disclosure of Proprietary Information
* Chinese Communist Party Co-opts Corporate Governance
¢ Placement of Chinese Employees with Foreign Joint Ventures
3. Economic Coercion
* Export Restraints Restrict Access to Raw Materials
* Monopsony Purchasing Power
4. Information Harvesting
* Open-Source Collection of Science and Technology Information
* Chinese Nationals in U.S. as Non-Traditional Information Collectors
¢ Recruitment of Science, Technology, Business, and Finance Talent
5. State-Sponsored, Technology-Seeking Investment
* Chinese State Actors Involved in Technology-Seeking FDI
* Chinese Investment Vehicles Used to Acquire and Transfer U.S. Technologies and IP
- Mergers and Acquisitions
- Greenfield Investments
- Seed and Venture Funding

SOURCE: White House Office of Trade and Manufacturing Policy, How China's Economic Aggression Threatens the
Technologies and Intellectual Property of the United States and the World, June 2018, https://trumpwhitehouse.
archives.gov/wp-content/uploads/2018/06/FINAL-China-Technology-Report-6.18.18-PDF.pdf (accessed March 21, 2023).

& heritage.org

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The following policy options were on the drawing board or in discussion as
preparations for a potential Trump second term were being made. These options
span the spectrum from purely trade-related like increasing tariffs to cutting off
Communist China’s access to American financial markets, research institutions,
and consumers. The next American President should strongly consider adopting
all of them as a package:

e Strategically expand tariffs to all Chinese products and increase tariff rates
to levels that will block out “Made in China” products, and execute this
strategy in a manner and at a pace that will not expose the U.S. to lack of
access to essential products like key pharmaceuticals.

e Provide significant financial and tax incentives to American companies that
are seeking to onshore production from Communist China to U.S. soil.

e Stop Communist China’s abuse of the so-called de minimis exemption,
which allows it to evade the tariffs for products valued at less than $800.

e Prohibit Communist Chinese state-owned enterprises from bidding on U.S.
government procurement contracts (for example, contracts for subway and
other transportation systems).

e Prohibit the use of Communist Chinese-made drones in American airspace.

e Ban all Chinese social media apps such as TikTok and WeChat, which pose
significant national security risks and expose American consumers to data
and identity theft.

e Prohibit all Communist Chinese investment in high-technology industries.

e Prohibit U.S. pension funds from investing in Communist Chinese stocks.

e Delist any Communist Chinese stocks that do not meet Public Company
Accounting Oversight Board standards or, alternatively, close off the
Chinese “A shares” stock market to U.S. investment and deregister U.S.-

sanctioned Communist Chinese companies.

e Prohibit the use of Hong Kong clearinghouses as transit points for American
capital investing in the Chinese mainland.

e Prohibit the inclusion of Chinese sovereign bonds in U.S. investors’ portfolios.

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Systematically reduce and eventually eliminate any U.S. dependence on
Communist Chinese supply chains that may be used to threaten national
security such as medicines, silicon chips, rare earth minerals, computer
motherboards, flatscreen displays, and military components.

Sanction any companies, including American companies like Apple, that
facilitate Communist China’s use of its Great Firewall surveillance and
censorship capabilities.

Order the Department of Homeland Security (DHS) and Department of
Justice to contract with U.S.-owned and U.S.-operated artificial intelligence
companies that are capable of detecting, identifying, and disrupting both the
domestic groups’ and CCP influencers’ social media operations and funding
streams using public information as a rapidly available offensive measure.

Reinvigorate and expand the DHS crackdown on the CCP’s use of e-sellers
(including third-party sellers) and the shippers and operators of major
warehouses such as Amazon, eBay, and Alibaba to flood U.S. markets with
counterfeit and pirated goods.

Compel the closure of all Confucius Institutes in the U.S., which serve as
propaganda arms of the CCP.

Significantly reduce or eliminate the issuance of visas to Chinese students or
researchers to prevent espionage and information harvesting.

Hold the CCP accountable for the COVID-19 virus, which almost certainly
originated as a genetically engineered virus from the Wuhan Institute of
Virology, and do so through the establishment of a presidential commission
or select congressional committee that would investigate the origins of

the virus; its various costs, both economically and in human life; and the
possible means of collecting damages from the CCP, which are likely to rise
to the trillions of dollars.

If the new US. President wishes to defend this country against the serious exis-

tential threat posed by Communist China, that President will adopt all of these

proposals through the requisite presidential executive orders or memoranda.

Effective Trade Policy in the Real World. To conclude this analysis, it is

useful to offer brief reflections on anumber of key obstacles to implementing the

policy initiatives recommended in this chapter. These obstacles include:

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e The dogma of the Ricardian free-trade model, which has been used as
propaganda to thwart the adoption of measures that seek to level the global
trading field for American manufacturers, farmers, ranchers, and workers;

e The politics of trade policy, which has led to a great divide that makes trade
policy reforms difficult to implement;

e The economics of trade deficits, which are not adequately understood either
by the American public or by the policymaking intelligentsia; and

e §=The crucial role of supportive White House and Administration personnel
in implementing effective trade policies.

The Dogma of Free Trade. Clearly, the fair and balanced trade orientation
of this chapter runs starkly against the free trade grain of the globalist Ricardian
orthodoxy, which is predicated on the theory that free trade represents the best
path by which to achieve both American and global prosperity. This orthodoxy
is based on the ivory tower academic conclusion that if countries trade freely
among each other, each will pursue its own comparative advantages; production
will be most efficient around the world; the economic pie will be bigger both
for the globe and for each free trading country; and (so long as workers who
lose their jobs are fairly compensated from the gains from trade) everyone will
be better off.

The most obvious problem with this orthodoxy (there are many more) is that
nowhere is Ricardian free trade mirrored in the real world. Instead, America
trades in a world where the WTO’s MFN rules are stacked against us, scofflaws
like Communist China run roughshod over what meager WTO rules there are, and
the United States among all of the world’s developed nations is the biggest victim
of the free trade Ricardian orthodoxy.

During his first term, President Donald Trump preached that there can be no
free trade without fair, reciprocal, and balanced trade. He was right then, and who-
ever is the next President in 2025 should heed this critical principle whenever the
flag of free trade is waved to prevent the adoption of needed reforms.

The Politics of Trade Policy: Who Benefits? Today, there is a great divide
among Americans that stands in the way of constructive trade policy reforms. This
great divide is certainly not about a partisan desire for low taxes and a reduced
regulatory burden. Rather, it is over whether our borders should be open or secure
and whether it is prudent to offshore our manufacturing and defense industrial
base and associated supply chains.

Those who support secure borders and seek to onshore more of American pro-
duction and supply chains do so to boost the real wages of American workers and to

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Mandate for Leadership: The Conservative Promise

enhance our national security. Some Americans historically have supported open
borders and offshoring under the flag of the Ricardian trade model, which assumes
the free flow of both labor and capital. Yet it is equally true that open borders and
offshoring also help American multinational corporations to maximize their profits
by minimizing their labor and environmental protection costs.

In particular, an open border policy, which allows for the unlimited migration of
cheap labor, depresses American wage rates and thereby boosts corporate profits.
At the same time, offshoring gives American corporations readier access to the
sweatshops and pollution havens of Asia and Latin America. Our skies and water
may be cleaner, and our products may be cheaper, Main Street manufacturers and
workers bear the brunt of these policies.

The obvious political problem in adopting many of the policies proposed here
is that they will be opposed by the special-interest groups that benefit from open
borders and offshoring and that contribute lavishly to both political parties. These
special-interest groups range from the hedge funds of Wall Street and tech entre-
preneurs of Silicon Valley to big-box retailers that stuff their aisles particularly
with cheap “Made in China” goods.

YES, TRADE DEFICITS MATTER

[O]ur country has been behaving like an extraordinarily rich family that
possesses an immense farm. In order to consume 4% more than we produce—
that’s the trade deficit—we have, day by day, been both selling pieces of the
farm and increasing the mortgage on what we still own.

Warren Buffett®”

Historically, one line of attack against attempts to implement fair trade policies
in the name of reducing America’s massive and chronic trade deficit has been the
claim that “trade deficits don’t matter.” The intellectual tip of this spear has often
been think tanks that generate reams of analyses in support of a purely free trade
(and open borders) American posture.** Yet both common sense and several very
good reasons tell us that trade deficits matter a great deal.

Economic Security. The economic security argument that trade deficits matter
begins with the observation that growth in any country’s real, inflation-adjusted
gross domestic product (GDP) depends on only four factors: consumption, gov-
ernment spending, business investment, and net exports (the difference between
exports and imports). Reducing a trade deficit through implementation of the US.
Reciprocal Trade Act, the application of tariffs, or renegotiating a bad trade deal
like NAFTA all represent ways to increase net exports—and thereby boost the rate
of economic growth.

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Suppose, for example, that under the USRTA the American President persuaded
India to reduce its very high protectionist tariffs and Japan to lower its formidable
nontariff barriers. America would surely sell more Florida oranges, Washington
apples, California wine, Wisconsin cheese, and Harley-Davidson motorcycles. The
resultant fall in the trade deficit would increase America’s GDP, and the real wages
of blue-collar America would rise from Seattle and Orlando to Sonoma and Mil-
waukee. But that’s not all.

Consider, too, the investment term in the GDP growth equation. When U.S.
companies offshore their production to chase cheap labor or manufacture in a

“pollution haven” country like Communist China or India with lax environmental
regulations, the result is reduced nonresidential fixed investment—and a GDP
growth rate that is lower than it would be otherwise. Moreover, if such offshored
production results in more foreign exports to the U.S.—for example, an American
consumer buys a Made in Mexico Dodge Journey or Chevrolet Trax rather than a
vehicle assembled in Detroit—the trade deficit rises along with the fall in invest-
ment, further reducing GDP growth.

National Security. The national security argument that trade deficits matter
begins with America’s national-income accounting double-entry system and this
accounting identity: Any deficit in the current account caused by imbalanced
trade must be offset by a surplus in the capital account, meaning foreign invest-
ment in the US.

In the short term, this balance-of-payments equilibrium may indeed “not
matter” as foreigners return our trade-deficit dollars to American shores by
seemingly benignly investing in U.S. government bonds and stocks. Of course,
this infusion of foreign capital lowers American mortgage rates and keeps the
stock market bullishly capitalized, which appears to be all to the good. Over time,
however, running large and persistent trade deficits leads to a massive transfer
of American wealth offshore into foreign hands. This wealth transfer happens as
foreigners use their export dollars to buy American real estate, companies, and
financial assets like the aforementioned stocks and government bonds.

The American investor Warren Buffett has referred to such wealth transfers
offshore as “conquest by purchase.” To Buffett, the big danger is that foreigners
will eventually own so many U.S. government bonds that Americans will wind up
working longer hours just to survive and service that foreign debt.

There is an even bigger national security danger, however, that Mr. Buffett has
missed: an alternative conquest-by-purchase scenario. Suppose, for example, that
one of the biggest holders of U.S. dollars is a rapidly militarizing strategic rival like
Communist China that is intent on world hegemony. By buying up America’s com-
panies, technologies, farmland, food producers, and key elements of the domestic
supply chain, Communist China can thereby gain more and more control of the
U.S. manufacturing and defense-industrial base.

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In this scenario, might America thereby lose a broader war for America’s freedom
and prosperity, not by shots fired but by American cash registers ringing up “Made
in China” products? Might America even lose a broader hot war because it sent its
defense industrial base abroad on the wings of a persistent trade deficit? It follows
that for both economic and national security reasons, trade deficits do indeed matter.
It is therefore of critical importance that we bring America’s global trade back into
balance through free, fair, balanced, and reciprocal trade and that we do so through
the kind of policy initiatives and reforms recommended in this chapter.

PERSONNEL IS TRADE POLICY

Having a clear set of trade and industrial policies to achieve one’s economic and
national security goals, while essential, is not enough. The lessons of the Nixon,
Reagan, and Trump Administrations teach us that “personnel is policy” or, in
this case, that “bad personnel will mean bad trade policy.”®? That is why it will be
equally critical to the next President’s trade policy agenda to have key personnel
in place who not only have the skills to implement the policies, but also have the
firm commitment to do so.

During the Trump Administration, President Trump’s key policy advisers
and Cabinet officials clashed on the issues of international trade and combating
Communist China’s economic aggression. As much as President Trump did on
the trade front that was bold and innovative and as much as he achieved by chal-
lenging Communist China, too much of his trade policy was disrupted or derailed
by key personnel who did not share the President’s vision of fair, balanced, and
reciprocal trade.

In thinking about the personnel positions that are most essential to effective
implementation of trade policy, the most obvious position to get exactly right is
that of the United States Trade Representative. The USTR is at least putatively
the top official on trade policy, and it is critical that this position be filled wisely.

Historically, during Republican Administrations, the USTR has been a free
trader who rarely challenged the protectionist and mercantilist policies of Amer-
ica’s trading partners and typically would seek to expand global trade. The Trump
Administration broke this globalist Republican tradition by appointing as USTR
attorney Robert E. Lighthizer, who not only had a keen understanding of the vari-
ous legal levers a President can use to advance trade policy, but also was committed
to the President’s fair, balanced, and reciprocal trade agenda. The next Adminis-
tration should make every effort to find someone with that understanding and that
commitment to fill this position.

Less obvious—but almost as important—is the need to fill the position of Under
Secretary of Commerce for International Trade wisely. One of the most important
functions of the International Trade Administration, which is an agency in the
Department of Commerce, is to impose antidumping and countervailing duties

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against trade cheaters who dump products below cost into American markets or
unfairly subsidize their exports. In fact, much of the cheating that does take place
in the global trading arena can be addressed through such antidumping (AD) and
countervailing duty (CVD) cases.

Within the West Wing itself, it is equally critical that the National Security
Adviser, the Chairman of the Council of Economic Advisers (CEA), and the Director
of the National Economic Council (NEC) all be aligned on trade policy. During the
Trump Administration, with the notable exception of the President’s third National
Security Adviser, Robert O’Brien, and third CEA Chairman, Tyler Goodspeed, this
regrettably was not the case.

Finally, and perhaps surprisingly, the Secretary of Defense plays a key role in
trade policy, at least when it comes to advancing Section 232 cases. Under Section
232 of the Trade Expansion Act of 1962,*° the President has the authority, through
tariffs or other means, to reduce imports from other countries “if the President
determines that such reduction or elimination would threaten to impair the
national security.” As a practical matter, the Secretary of Commerce spearheads
any Section 232 cases, but in order to proceed with a Section 232 case, Commerce
must obtain signoff from the Secretary of Defense.

When President Trump wanted to implement steel and aluminum tariffs, he
had a willing servant in Secretary of Commerce Wilbur Ross. However, Secretary
of Defense James Mattis resisted. Mattis simply did not understand a key tenet of
the Trump Administration: Economic security is also national security. Without
vibrant steel and aluminum industries, it will be difficult for America to provide
the Pentagon with the kind of weapons it needs to defend the homeland.

CONCLUSION

A Harvard professor once told me during my doctoral thesis days that “if I tell
you how it is, I’ve told you why it can’t change.” Despite the obvious exploitation
of American farmers, ranchers, manufacturers, and workers by the international
trading system and Communist Chinese aggression, powerful political forces none-
theless exist that profit from the status quo.

The stark lesson of this chapter is that America gets fleeced every day in the
global marketplace both by a predatory Communist China and by an institution-
ally unfair and nonreciprocal WTO. Addressing these two challenges would go a
long way toward restoring American greatness, both economically and militarily.
Ignoring these two challenges will simply continue the parasitic draining of the
American manufacturing and defense industrial base.

AUTHOR’S NOTE: The author alone assumes responsibility for the content of this chapter, and no views
expressed herein should be attributed to any other individual. However, the author would particularly like to thank
Joanna Miller for her dedicated work and significant contribution to the chapter.

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THE CASE FOR FREE TRADE

Kent Lassman

T rade policy is about more than goods and services: It is a statement of Amer-
ican identity. Our trade policy choices reveal America’s values and where we

put our trust. Do we place our trust in Washington elites to revive a declining coun-

try, or do we trust in America’s tradition of entrepreneurs and everyday people

blazing new trails? Do we follow China by copying its strong-arm trade policies,

or do we lead China and the rest of the world by forging our own path? Our trade

policy decisions will tell you what we Americans really think of ourselves.

A CONSERVATIVE VISION FOR TRADE

The policy recommendations in this chapter reflect a belief in the strength of
America’s founding institutions, its economy, and its people. They are based on data
showing decades of American progress with all that this implies. They also reflect
arealistic understanding of the fact that trade policy has limited capabilities and
is vulnerable to mission creep and regulatory capture. Policymakers should be
modest about what they can accomplish through trade policy and need to exercise
constant vigilance against abuses. For example:

e Trade can lower consumer prices for ordinary Americans and open new
markets for American businesses and their goods.

e Trade can help American workers and businesses to specialize in what they
do best—which is how they outcompete the rest of the world in technology,
manufacturing, agriculture, and other areas.

e In foreign policy, trade can help to preserve and strengthen alliances.

At the same time, sound trade policy requires humility. It is not a panacea for
every policy problem. Trade policy cannot favor one sector over another without
causing tradeoffs that outweigh the benefits. Neither free trade nor protectionism
will create jobs. Trade affects the types of jobs people have, but it has no long-run
effect on the number of jobs. Labor force size is tied to population size more than
anything else. The American people are smart and sophisticated enough to hear
these truths.

It is not just conservatives who overestimate the power of trade policy. Recent
progressive attempts to use trade policy to advance whole-of-government initia-
tives on climate, equity, and other issues will fail for the same reason that a hammer
cannot turn a screw: It is the wrong tool for the job. Conservatives should be sim-
ilarly skeptical of recent attempts on the Right to use progressive trade policy to
punish political opponents, remake manufacturing, or accomplish other objectives

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for which it is not suited. The next Administration needs to end the mission creep
that has all but taken over trade policy in recent years.

Trade policy works best when it sticks to trade and treats separate issues
separately. Trade agreements since the North American Free Trade Agreement
(NAFTA) have been increasingly burdened by trade-unrelated provisions involving
labor, environmental, intellectual property, and other regulations. Where these
were a side agreement to NAFTA in the 1990s, they were integrated into the main
text of the United States-Mexico—Canada Agreement (USMCA) in 2019. The
Indo-Pacific Economic Framework for Prosperity (PEF) that the Biden Admin-
istration is currently pursuing consists entirely of trade-unrelated provisions:
Negotiations are steering clear of trade altogether.

Trade-unrelated provisions are routinely hijacked by progressives and rent-seek-
ers and dilute otherwise worthwhile trade agreements. They also create additional
points of contention that make agreements unnecessarily difficult to pass. A con-
servative trade policy should limit trade-unrelated provisions in trade agreements.

This does not mean that conservatives should ignore international negotiations
on labor, environment, intellectual property, and other non-trade issues. It means
they are more likely to succeed by treating each of them separately rather than
letting them die in committee with each providing an additional sticking point
for delaying the others.

Aconservative trade policy must also take seriously the reality that in a democ-
racy, the other side holds power about half of the time, but progressives run most
agencies almost all of the time. A cardinal rule in public policy is not to give yourself
powers you wouldn’t want your opponents to have. That means building institu-
tion-level safeguards against mission creep to limit abuses.

Foreign policy considerations are not as separate from trade as are labor or
environmental standards. China deserves special consideration, as does the World
Trade Organization (WTO) along with its possible successors or alternatives. While
trade is not the star of American foreign policy, it does play a supporting role. It
should be used to strengthen alliances to help counter China, Russia, and other
threats while making economic and cultural inroads inside them. The next Amer-
ican President should use this aspect of trade to the nation’s advantage.

Drawing from America’s Roots. In 1776, nearly 90 percent of Americans were
farmers. For 10 people to eat, nine had to farm. That meant fewer people could
be factory workers, doctors, or teachers, or even live in cities, because they were
needed on the farm. Accordingly, life expectancy was around 40 years, and literacy
was 13 percent.”

Today, fewer than 1 percent of Americans work on farms, yet America is a net
exporter of food. People have infinite wants, so as rising productivity pushed some
people off of farms, there were countless other jobs they could do. In true American
fashion, many of these jobs were in brand new industries.

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This was possible because the same can-do cultural values that inspired the
American founding were accurately reflected in its new government. The U.S. Con-
stitution created what was then the world’s largest free trade area, and it did so on
purpose.** The combination of the American self-improvement ethos and the large,
free internal market guaranteed by the Constitution yielded intensive growth on
a scale never before seen.

Many displaced farm laborers got jobs making the very farm equipment that
made intensive agricultural growth possible, from railroad networks to cotton gins.
Each fed the other. Agriculture and industry are not separate; they are as inter-
connected as everything else in the economy. None of this could have happened
had the government enacted policies to preserve full agricultural employment.

Understanding Value. Just as communication is impossible without agreed-
upon definitions of words, coherent policymaking is impossible without coherent
categories. Policies are not likely to succeed when they try to separate an intercon-
nected economy into arbitrary categories. The factory worker who builds a tractor
does as much to boost farm production as the farmers themselves, yet economic
planners put them in different categories. This problem is baked into industrial
policy, as progressive planners have learned again and again.

Aconservative approach to economic policy should treat value as value, whether
it is created on a farm, in a factory, or in an office. A dollar of value created in
manufacturing is neither more nor less valuable than a dollar of value created in
agriculture or services.

Pursuing Access to Growing Markets. American history holds lessons for
today’s conservative trade policy. Some modern analysts see a correlation between
high tariffs and high growth and confuse it for causation,“ but 19th century Amer-
ica teaches a different lesson.

While the Constitution banned internal tariffs in the US., international tariffs
reached their highest levels in U.S. history during the 19th century, beginning with
the 1828 Tariff of Abominations.* At their peak in 1830, the average tariff on duti-
able goods was 62 percent.** Fortunately, however, the tariffs’ distorting effects
were outweighed by market growth elsewhere. The 19th century saw Western
expansion and a growing population (including millions of immigrants) working
for the American dream. America’s growing internal free trade zone allowed for
still more specialization and more trade across state borders.

America’s geographic expansion ended long ago, but population growth, the
U.S.-led rules-based international trading system, and the steady 75-year decline
in tariffs after World War II have made possible decades of continued prosperity.
Intensive growth requires specialization, and the larger the market, the more spe-
cialization is possible.

Fighting Pessimistic Bias. Farmers’ share of the population continued to
decline through this entire period, yet employment remained high, and the

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CHART 1

U.S. Real GDP per Capita

REAL GROSS DOMESTIC PRODUCT PER CAPITA, IN CHAINED 2012 DOLLARS,
SEASONALLY ADJUSTED ANNUAL RATE

$70,000
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000

$0
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020

SOURCE: Federal Reserve Bank of St. Louis, “Real Gross Domestic Product per Capita,”
httos://fred.stlouisfed.org/series/ A939RXOQO48SBEA (accessed March 2, 2023). & heritage.org

economy continued to grow. Factories were not the only beneficiaries of agri-
culture’s productivity boom and the labor it freed; services also grew. In fact,
service-sector employment surpassed manufacturing employment around 1890—
far earlier than most people realize.”

Pessimistic bias is one of the most important cultural problems that conserva-
tive policymakers need to address. In trade, as in most other areas, few people ever
zoom out to see the big picture, which is one reason why so many people mistakenly
believe that U.S. manufacturing and the U.S. economy are in decline.

The data do not show American economic carnage. They show more than two
centuries of intensive growth, made possible by a growing internal market through-
out the 19th century and a growing international market in the post-World War
II era. The transition from farm to factory did not shrink the labor force or farm
output. Later, the transition from factories to services did not shrink the labor

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force, factory output, or farm output. Both transitions affected the types of jobs,
not the number of jobs.

Americans today can more easily afford everything from air conditioning to
flat-screen televisions and smartphones, and trade is one reason why. Bigger mar-
kets mean more specialization, more innovative ideas, more customers, and more
people from whom to buy.

America’s official unemployment rate went as low as 3.5 percent during 2022,
while real per capita gross domestic product (GDP) rose to an all-time record.
Clearly, people who wanted to work were able to find work that paid well even as
manufacturing jobs grew more slowly than service jobs.

IMPLEMENTING THE CONSERVATIVE VISION

Vision will be crucial for the next conservative Administration, but nuts-and-
bolts policies are also important. Making the conservative vision for trade a reality
will require several actions, some of which may prove to be more difficult to achieve
than others. Specifically:

e Implement tariff reliefto help counteract inflation by reducing prices
for affected goods as well as to strengthen supply chains and boost
manufacturing. End Section 232, 201, and 301 tariffs. Work with Congress
to pass legislation repealing those provisions so future Presidents
cannot abuse them.

e Resist calls for more spending on trade adjustment assistance, which
is often hijacked for progressive ends. Technology and changing tastes
displace six times as many workers as does trade, yet those workers get no
such special treatment. Displaced workers should receive the same benefits
regardless of the reason.

e Remove never-needed supply chain restrictions, which give families fewer
places to which they can turn. The recent shortage of baby formula, for
example, was caused largely by heavily protectionist regulations. Strength
and resilience come from openness.

e Enact mutual recognition policies with allies. If a product is safe enough for
European or Japanese consumers, then it is safe enough for Americans as
well—and vice versa. This can reduce regulatory costs and open new markets.

e Close the Export-Import Bank, which serves mainly to subsidize foreign

buyers’ purchases of goods from a handful of well-connected American
manufacturers.

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Repeal the Jones Act,** a century-old “Buy American” maritime law that
has decimated the U.S. shipbuilding industry.

Work with Congress to restore the President’s Trade Promotion Authority,
which would expedite the negotiation of trade agreements with the United
Kingdom, Switzerland, Taiwan, the European Union, and other allies, and
keep trade-unrelated provisions out of trade agreements.

Restore the World Trade Organization’s dispute resolution process to
full strength.

Create a successor to the WTO (assuming that it has been fatally wounded)
that is open only to liberal democracies. This would prevent authoritarian
countries like China from abusing the organization for their own ends.

Adopt a multi-pronged China strategy to convince the Chinese government
to reform its illiberal human rights and trade policies.

Rejoin the Trans-Pacific Partnership (TPP), whose 11 members are
developing institutional trade norms in an important geopolitical region
without U.S. input or involvement.

Reorient the proposed Indo-Pacific Economic Framework for Prosperity to
focus only on trade issues, which it currently ignores in favor of progressive
wish-list policies.

Strengthen diplomatic pressure (in concert with allies) against Beijing’s
abuses. Encourage cultural and intellectual engagement with the Chinese
people, remembering that blue jeans and rock’n’ roll helped to win

the Cold War.

Tariff Relief. When people try something repeatedly and it still doesn’t work,

they should stop doing it—especially when the consequences turn out to be just

what conservative economists have long predicted they would be.** With tariffs,

the proper reform is not only to get rid of the individual tariffs that have backfired,

but also to build institutional safeguards against future abuse.

We are five years into the biggest experiment with tariffs since the Great Depres-

sion, and the results are in: The new tariffs raise consumer prices for ordinary

Americans by about $1,200 per household every year” and benefit only a small

number of special interests. Steel and aluminum tariffs, enacted on national

security grounds, angered allies. Beijing made not a single substantive reform in

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response to four rounds of tariffs plus an attempted Phase One agreement. The
Biden Administration has left the tariffs in place and is expanding them to pursue
progressive policy goals.

The first order of business for a new Administration that is focused on American
workers and consumers is to repeal all tariffs enacted under Section 232 of the
Trade Expansion Act of 1962* and Sections 201 and 301 of the Trade Act of 1974.”
The President can do this unilaterally, and Congress can do it through legislation.

The second order of business requires Congress to pass legislation repealing
Sections 232, 201, and 301. The U.S. Constitution places all taxing authority with
Congress** and none with the President. Congress used those provisions of law
to delegate some of its taxing authority to the President because it was having
trouble passing “clean” tariff legislation in the 1960s and 1970s. Unless and until
this constitutional question about delegation is addressed, important reforms are
available to the next Congress and the next President.

Congress faced a problem of collective action in the 1960s and 1970s. As awhole,
Members generally wanted to lower tariffs, but few individual Members were will-
ing to remove tariffs that benefited special interests in their districts. Trade bills
were invariably watered down through amendments and logrolling. The thinking
was that the President, whose constituency is the entire nation, would be less prone
to special-interest pleading than Members of Congress would be, so Congress del-
egated some of its tariff-making authority to the President in 1962 and 1974 trade
legislation.

Delegating tariff-making might have worked in the short run, but in the long
run, it was both constitutionally dubious and ripe for abuse. That came to pass in
2018. The Section 232 steel and aluminum tariffs, invoked in 2018 against Canada,
Europe, and other allies on national security grounds, raised car prices by an aver-
age of $250 per vehicle and gave America the world’s highest steel prices. They
also harmed the construction, canned food and beverage, and other metal-us-
ing industries.

While this may have benefited the steel industry itself, each steel job saved cost
an average of $650,000 per year that had been taken from elsewhere in the econo-
my.™ That is no way to strengthen American manufacturing. The New York Federal
Reserve estimated in 2019 that the Section 301 China tariffs cost the average house-
hold $831 per year,” a figure that has likely increased with inflation.

The new tariffs have a clear record of failure—as conservative economists
almost unanimously warned would be the case. Job number one for the next
Administration is to return to sensible trade policies and eliminate the destruc-
tive Trump- Biden tariffs.

Strengthening American Manufacturing. The decline of American manu-
facturing is acommon political trope in both parties, typically invoked before a call
for more government intervention. This narrative has several problems. One is that

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American manufacturing output is currently at an all-time high. The record was
not set during World War II and not during the 1950s boom. Output did not peak
when manufacturing employment peaked in 1979 or during the Reagan economic
revival in the 1980s. It is actually higher now than it has ever been.

American manufacturing is buoyant because each manufacturing worker’s pro-
ductivity is also at an all-time high. The key to prosperity is doing more with less.
The next President should ignore special interests and populist ideologues who
want government to do the opposite through industrial policy, trade protectionism,
and other failed progressive policies.

It takes surprisingly few people to achieve America’s record-high manufac-
turing output—currently about 13 million people out of a workforce of more than
160 million, compared to the 1979 peak of 19.5 million people out of a workforce
of 104 million.*° Productivity growth has freed the time and talents of millions of
people for other, additional uses.

The belief that manufacturing has to shrink for services to grow is the zero-
sum fallacy against which sensible economists often warn. It is anathema to the
optimism, hope, and confidence that are the natural birthright of conservatives.
Growing productivity enables more output of both manufacturing and services.
That is why America continues to have sustained booms and record-setting real
GDP despite the long-run decline in manufacturing employment.

Economists distinguish between two types of growth: extensive and intensive.
Extensive growth is the Soviet and Chinese model for manufacturing: If you have
more people use more resources, they will create more output. Extensive growth
is doing more with more; intensive growth is doing more with less. That is where
America’s superpower lies. The story of American manufacturing is one of intensive
growth dating back to our agricultural origins. Conservative leaders should draw
on this history to position America for continued success. With intensive growth,
it isnot manufacturing or services; it is manufacturing and services.

Retaliatory Tariffs. Raising tariffs on another country almost always invites
retaliatory tariffs against the U.S. The latter tend to be directed at politically sen-
sitive American exports. Retaliatory tariffs by both China and American allies in
response to the 2018 steel tariffs were targeted primarily at American agriculture.
According to the U.S. Department of Agriculture, those tariffs cost farmers $27
billion with losses concentrated particularly in heartland states.”

Retaliatory tariffs also targeted U.S. industries that were not protected by tar-
iffs. Many imports become inputs into U.S. manufacturing. The motorcycle maker
Harley-Davidson was already facing higher production costs as domestic steel
producers raised their prices to accommodate the new steel tariff. A retaliatory
tariff on its motorcycles imposed by the European Union further raised its prices
and hurt its export business. Harm to such innocent bystanders was another unin-
tended (though foreseen) consequence.

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CHART 2

Total U.S. Industrial Production

INDEX 2017=100
120

100

1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 2020

SOURCE: Federal Reserve Bank of St. Louis, “Industrial Production: Total Index,”
https://fred.stlouisfed.org/series/INDPRO (accessed March 2, 2023). & heritage.org

Federal Reserve research shows that the tariffs have cost about 75,000 manufac-
turing jobs while creating only about 1,000 jobs in the steel industry—not including
the effects of the retaliatory tariffs described above.® Higher steel prices added an
average of $250 to the price of new cars, and larger trucks—the vehicle of choice
in rural America—were hit even more dramatically.*?

Trade is generally a win-win for both participants. Tariffs are a lose-lose-lose
game, with the tariff raiser losing affordable goods, the tariff target losing exports,
and the tariff raiser losing again from retaliatory tariffs. Tariffs also have an addi-
tional overlooked hidden cost: Companies redirect resources to dodge tariffs by
redesigning products, switching to more expensive suppliers, using lower-qual-
ity materials, and lobbying. This might be good for lawyers, but it is bad for the
economy. These resources could have been used instead to make a better product
more cheaply.

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Conservatives warned against retaliation from the beginning: It was exactly
what happened after the 1930 Smoot-Hawley tariffs that worsened the Great
Depression.

Undoing the Normalization of Protectionism. Inertia is one of the strongest
forces in politics. Radical new policies can become the new normal very quickly and
are extremely difficult to unwind if they backfire. This happened with the Trump
Administration’s progressive turn on protectionism. The Biden Administration
quickly undid the Trump Administration’s conservative regulatory reforms but
left its progressive, self-defeating trade policies in place—in many cases even
strengthening them.

Two presidential Administrations is a long time in politics, and the next conser-
vative Administration will have a tough time getting tariff relief past a bureaucracy
that dislikes change and special interests that will fight hard to preserve their
special privileges. But given the stakes for future American prosperity, it will
be worth it.

Dealing with Disruption. It is true that trade is disruptive. Though its long-
run effect on employment is approximately zero, in the short run it can cost jobs
and even depopulate towns.’ America’s resilience depends on its ability to adjust,
but successful and timely adaptation is generally spontaneous in nature—the work
of human action but not human design. Planned adjustment by governments has
a much poorer track record.

Context is also important to adjustment efforts. Technological change costs
approximately six times more jobs as does trade (though, again, only in the short
run).°? Any argument made against trade’s disruptive effects applies even more
strongly to technological change, yet no one seriously argues for reversing the
dramatic changes the Internet has wrought.

More than 11 million American jobs turn over through hirings, firings, retire-
ments, layoffs, and resignations every month,® and nearly 85 percent of all
jobs turn over in the course of a year. Yet America has suffered only four bouts
of double-digit unemployment during the past century. Two of them, the Great
Depression and the comedown from the 1970s stagflation, were due to monetary
mismanagement, not trade.” The third, the Great Recession, was due toa financial
crisis worsened by monetary mismanagement, not trade.® The fourth was due to
COVID-19 lockdowns, not trade.

Using trade restrictions to slow this churn is a mistake for two reasons: (1) trade
is at best a minor contributor to job churn compared to other factors like tech-
nology, changing consumer tastes, inflation, and business cycles, and (2) churn is
evidence of a healthy economy. Agricultural economies have low job churn and
low living standards.

When people see better opportunities, they should be allowed to pursue them.
To do otherwise slows economic growth, harms individual dignity, removes

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Mandate for Leadership: The Conservative Promise

humanity from our policies, and can contribute to societal ills like depression,
addiction, and isolation.

Trade adjustment could be made easier by regulatory reforms to remove its
attendant friction. These include:

e Less restrictive zoning and permit rules;
e Occupational licensing reform;
e Automatic sunsets for new regulations; and

e Apresidentially appointed Regulatory Reduction Commission that would
examine the Code of Federal Regulations each year and send repeal
packages to Congress that include old, obsolete, redundant, and harmful
regulations.”

People who need help should be able to get it. Progressive trade policies
help only special interests while harming the very people they are supposedly
intended to help.

Trade Adjustment Assistance. Trade adjustment assistance is a popular
policy for aiding displaced workers. Though flawed, it is a bargaining tool that
can potentially help to get sound trade policy adopted. A conservative Adminis-
tration should approach trade adjustment assistance with caution and use it as a
last-resort political bargaining tool and not as a first-resort policy. Funding for job
training programs and the like will typically find its way to labor union slush funds,
left-leaning nonprofits, and other progressive causes that will not necessarily help
displaced workers.

A better approach to trade adjustment assistance, if it must be expanded, is
direct cash transfers. Not only would this prevent progressive hijacking of pro-
grams and their funding, but cash is the most flexible type of aid. It treats people as
adults and lets them make their own choices about their next steps. Major life deci-
sions should be made by individuals for themselves, not for them in Washington.

Trade adjustment assistance should treat workers who lose their jobs to inter-
national trade the same as workers who lose their jobs for any other reason are
treated. While that will not likely come to pass in the near future, steps in that
direction are possible. Technological change displaces six times as many workers
as trade displaces, yet workers displaced by technology get no special treatment.
Nor should they. Unemployment remains low because it grows alongside pop-
ulation, and real wages continue to rise over time. Trade-displaced workers
should be eligible for the same benefits for which anyone else is eligible, no more
and no less.

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Supply Chain Lessons from the Baby Formula Debacle. Protectionism
builds weaknesses into supply chains. This was demonstrated vividly by the baby
formula shortage, which may have peaked in 2022 but remains an ongoing concern.

Domestic baby formula producers benefit from a decades-old tariff that averages
17 percent, which is effectively high enough to shut imports out of the market. As
if tariffs were not enough, other requirements also help to keep competition out
of the market: ever-evolving labeling requirements and nutritional standards that
(conveniently for domestic manufacturers) are always just slightly different from
international standards. As a result, before the formula shortage in 2022, approx-
imately 98 percent of the country’s baby formula was produced domestically.

With foreign competition out of the way, other government policies helped to
concentrate almost the entire domestic formula industry into four firms. Roughly
40 percent of baby formula purchases are made by state-level food assistance pro-
grams, which typically do not let families choose their own formula brands. Instead
they must buy from a single producer, which guarantees producers large market
shares in states where they win contracts. This situation gives incumbent pro-
ducers a cozy existence but puts consumers at risk. Like all protectionist policies,
the benefits are concentrated in the hands of a few producers while the costs and
risks are widely distributed.

With so many eggs in so few baskets, whenever something goes wrong—which
is inevitable even when nobody is at fault—families find themselves scrambling.
That happened early in 2022 when contamination entered a Michigan facility that
makes about 40 percent of America’s baby formula. Trade protectionism all but
eliminated other options for many parents, who suddenly found empty shelves and
sky-high prices for an essential item that many of them were already struggling to
afford—while families in other countries were unaffected.

In response, Congress passed the Formula Act® in the summer of 2022. The act
eased formula tariffs and loosened never-needed labeling requirements and other
import restrictions, but it was temporary. It expired at the end of 2022, leaving
families still vulnerable to the cascading consequences that ensue if one thing
goes wrong at only one plant.

The baby formula debacle has two lessons for the next Administration.

e The Administration needs to attack the root of the problem. Temporary
fix-it bills are better than nothing, but they leave the rot in place. The
President needs to encourage bold liberalization.

e Strength comes from openness. In the real world, markets fail. Factories will
get contaminated, and health inspectors will not always be as thorough as
they should be. The baby formula market is essentially a natural experiment
in self-sufficient industrial policy. When something went wrong, that single

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Mandate for Leadership: The Conservative Promise

failure point crashed the whole system. It should not be that way, and the
next President can change it.

Part of the problem is that the supply chain analogy itself causes sloppy thinking.
In achain, a link is connected only to the link ahead of it and the link behind it and
not to any other links. Real-world supply chains are more like networks in which
each point connects directly to countless others and is rarely more than six degrees
of separation from nearly anywhere on Earth. Because market failures happen
all the time, it is important to have as many connections as possible. Americans
need access to more ways to adapt and reroute around failure points, especially
for essential products like baby formula.

Trade protectionism makes us more vulnerable, but free trade makes our fam-
ilies and communities more resilient. Loosening restrictions similar to the ones
that stunt the baby formula market would make it easier to navigate future crises
while preventing the progressive and rent-seeking power grabs that come with
every crisis, whether it is as isolated as a baby formula shortage or as expansive
as a pandemic.

Mutual Recognition. A simple way to reduce friction in supply networks is
mutual recognition of other industrialized countries’ regulatory standards. This
can be done either in a larger trade agreement or independently. For baby for-
mula, this would mean allowing in brands that meet European Union standards
even if they do not meet Food and Drug Administration (FDA) labeling require-
ments. Infants’ nutritional needs do not change across borders. If a formula is
deemed healthy for European babies, then it is also healthy for American babies.
The reverse is equally true.

Mutual recognition could help to open new markets for American producers in
countless industries and give American consumers access to countless new prod-
ucts on more competitive terms. For example, U.S. regulations require washing
machine power cords to be at least six feet long, while the U.K. requires them to be
at least two meters. The difference (about six inches) affects neither safety nor
performance, but it does keep American-made washing machines out of an import-
ant foreign market. A mutual recognition policy would circumvent the problem.

Given the recent interest in increased antitrust enforcement, conservatives
should embrace policies like mutual recognition that have the double benefit of
increasing market competition while decreasing government’s regulatory footprint.

The U.S. should enact mutual recognition agreements for a wide variety goods
with the United Kingdom, European Union, Japan, South Korea, Australia, and
other governments with high standards comparable to our own. This would have
especially large benefits for pharmaceuticals, because America’s FDA drug approval
process is both slower and more expensive than those of other countries with-
out being any safer. Americans would gain access to more and lower-cost medical

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2025 Presidential Transition Project

treatments, and American pharmaceutical companies could defray development
costs and innovate faster by gaining access to more markets, all while cutting prices.

The Jones Act. The Jones Act (Merchant Marine Act of 1920)”° requires that
ships traveling between U.S. ports must be U.S.-built, U.S.-owned, and U.S.-crewed.
In practice, this is an “America last” policy that has decimated the American mari-
time industry.” Because of Jones Act regulations, American-built ships cost three
to four times more to build than foreign-built ships cost. As a result, the entire
Jones Act fleet is down to just 92 ships, many of which are old and obsolete. In fact,
Jones Act-compliant shipping is so expensive that it is often cheaper for East Coast
ports to import oil from Vladimir Putin’s Russia than it is to send it up the coast
from Houston or New Orleans. The national security (to say nothing of energy
security) implications of reliance on Russia for oil and gas are obvious.

The Jones Act’s original national security justifications are just as dubious. The
act’s goal was to guarantee a sizable fleet of American ships that could be pressed
into war service if needed. Aircraft carriers and other post-1920 naval innovations
have made this argument obsolete. An $800 billion defense budget has plenty of
room to maintain a Navy to defend American security interests around the world.
The U.S. Navy would likely prefer not to use Jones Act ships anyway, because they
tend to be older and in poorer condition than its own ships or similar foreign-made
but domestically owned commercial ships that could also be pressed into service.

As with many other industries, U.S. shipbuilding could be the envy of the world if
it could operate in a free market, but the maritime lobby prefers a quiet, cozy exis-
tence on the dole even as it harms American consumers and national security. The
next conservative Administration should unleash American potential by unilater-
ally enacting Jones Act exemptions wherever allowed, as currently happens most
years during hurricane season, and working with Congress to repeal the Jones Act.

Trade and Inflation. The post-COVID inflation spike may be over long before
the next Administration takes office, but keeping it under control should remain
a high priority. Free traders should not oversell their case by saying that liberal-
ization would solve inflation. Inflation is predominantly a monetary phenomenon,
not a trade phenomenon, but tariff relief can help at the margin by immediately
lowering prices on tariffed goods and slightly boosting long-term growth.” While
this would not affect the money supply, which is inflation’s key variable, even roll-
ing back the tariffs enacted since 2017 would likely have a positive effect on the
Consumer Price Index.

The easiest way to curb inflation (or to create it) is for the Federal Reserve to
work the monetary side of the equation, but the real output side has a similar effect
on prices. Lifting trade barriers is one way to boost output. It also has the added
benefit of requiring no additional spending. At the very least, this can make the
Federal Reserve’s job easier as the spending excesses of Congress and President
Biden continue unabated in the coming years.

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It is important not to oversell trade’s inflation benefits as a cure-all, but at the
margin, it can help. The next Administration should keep this in mind as it tries
to cope with this politically volatile issue.

Trade and Foreign Policy. We have seen how trade liberalization would boost
the domestic economy and make American businesses more competitive, but
conservative trade policies also benefit America’s foreign policy interests. Policy-
makers should therefore:

e Negotiate multilateral and bilateral trade agreements.

e Reform the World Trade Organization or build a successor organization
with membership limited to liberal democracies.

e Repeal the Jones Act to replace Russian energy imports with
domestic production.

e Develop a multifaceted, long-term China policy that takes seriously
America’s biggest foreign policy threat and deals with it on several fronts.

National Security. The most persuasive arguments against a market-oriented
trade policy come from another national objective: national security. Protection-
ism and similar progressive policies tend to weaken American security, but trade
creates peace. The more countries trade, the less likely they are to fight one another
and the more robust their supply networks will be. Going to war with customers
is bad for business.

Without a strong economic interest in continued U.S. investment and exports,
for example, China’s behavior would likely become increasingly less predictable
and more dangerous. Anyone who thinks Chinese Communist Party (CCP) General
Secretary Xi Jinping and the government in Beijing are bad actors now—which they
are—should consider what would happen if the Chinese convinced liberal countries
like the United States to decouple from them, leaving them free to pursue whatever
policies they wish without the significant counterweight that America can provide.

That is one reason for Xi Jinping’s emphasis on centralization and self-suffi-
ciency. He does not like international pressure about his government’s human
rights violations and bad-faith trading policies, and decoupling from trading part-
ners like America is one way to avoid that pressure. A less constrained China would
be poorer but much more unstable and dangerous to its neighbors and to America
than it would be if it still had to engage regularly with the rest of the world.

Trade Promotion Authority. Trade agreements can take years to negotiate.
One way to accelerate the process is for Congress to grant the President Trade
Promotion Authority (TPA). It was first granted under the 1974 Trade Act, which

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contains the Sections 201 and 301 tariff delegations. TPA, then called fast-track,
has aided several trade agreements, including NAFTA and the USMCA, which took
effect in 2020. TPA has lapsed before during slow periods in trade policy, most
recently in July 2021, and remains lapsed today.

The President should work with Congress to renew TPA to rationalize negoti-
ations for upcoming trade agreements with the United Kingdom, the European
Union, and others.

Both supporters and critics have questions regarding TPA’s implications for the
constitutional separation of powers, and policymakers should take those questions
seriously. As things currently stand, Congress has some oversight powers over the
President’s negotiations under TPA, but they are limited. Congress can increase
its oversight by passing new legislation superseding relevant provisions of the
1974 Trade Act. However, that is a double-edged sword. A Congress that largely
favors free trade could exercise oversight to keep the President on the straight and
narrow in trade negotiations. A progressive Congress would instead insist that the
President negotiate for as many trade-unrelated provisions as possible to benefit
labor and green constituencies while pushing progressive policies on the U.S. and
its trading partners.

On balance, a single voice at the negotiating table that is subject to congressional
oversight is the best posture for American workers and consumers. A fractious
Congress has yet to demonstrate the capacity to negotiate with other nations, but
it can help to hold the Administration accountable.

Trade Agreements with the United Kingdom, European Union, and
Others. Even with a renewed TPA, trade agreement negotiations will likely take
years. The Trump and Biden Administrations were not inclined to start the process,
so that job may well fall to the next Administration. In that sense, the delays may
end up being worth it.

If there is one lodestar to follow, it is to restrict these agreements to trade issues
only. Ever since NAFTA, trade-unrelated provisions have taken on a greater role
in trade agreements. These create sticking points and are routinely hijacked by
rent-seeking special interests and progressive ideologues who demand subsidies,
carve-outs, and economically distorting labor and environmental standards that
have nothing to do with trade. If governments are to negotiate these issues, they
should do so in separate agreements so they do not torpedo efforts to liberalize
and engage with allies. Trade agreements should lighten burdens, not create new
ones by attempting to address non-trade issues.

Policy leaders in the United States and the United Kingdom, including
experts from The Heritage Foundation and the Competitive Enterprise Insti-
tute, have prepared a model trade agreement along these lines.”* Along with TPA
renewal, this would greatly reduce negotiating costs. This template is also readily
adaptable for agreements with Europe and any other allies that are willing to

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Mandate for Leadership: The Conservative Promise

liberalize their economies and build a stronger alliance with America. The draft
U.S.-U.K. agreement includes an accession chapter to allow others to join on
the same terms.

Restoring or Replacing the WTO Dispute Resolution Process. The World
Trade Organization as we know it may be mortally wounded. This deprives the U.S.
of the WTO’s dispute resolution process, under which the U.S. it won 85 percent of
the cases it brought. The WTO’s slow death began under the Obama Administra-
tion, which refused to allow appointees to the WTO’s appellate board, which as a
consequence is now nonfunctional. Both the Trump and Biden Administrations
have continued the Obama Administration’s approach.

That means that every case in the dispute resolution process will sputter to
a halt as parties file appeals that cannot be heard. If the WTO is no longer fit for
that purpose, it may be better to look in a different direction. More than 20 years
ago, a Heritage Foundation senior fellow proposed that America and other free
economies should form a Global Free Trade Alliance that is open to all countries
that adhere to a truly free market system with appropriate safeguards such as
property rights, lack of corruption, and enforcement of contracts.” Alongside a
general agreement on low to zero tariffs, the alliance would move to reduce the
effect of nontariff barriers (such as the previously noted baby formula ingredient
and labeling barriers) by basing trade around the principle of mutual recognition.
Such an alliance could be started by a trade agreement between the United States
and, for example, the United Kingdom with an accession chapter allowing others
to join if they meet the criteria.

It would be essential for a Global Free Trade Alliance to avoid the WTO’s most
serious problem: the exemptions from its rules that are granted to developing
countries. When China joined the WTO in 2001, it was granted developing-na-
tion status, which it continues to use to dodge rules that should apply to it. Other
countries have used that status to delay needed reforms. Rule exemptions give
some countries a perverse incentive to remain poor and autocratic.

A Global Free Trade Alliance would allow the U.S. to enjoy the benefits of a rules-
based international trading system without the WTO’s shortcomings. Negotiation
costs would be lower because the countries would already be allied on many issues.
In addition, there would be no separate tiers with different rules, and this would
give developing countries an incentive to liberalize. In addition to being good for
its own sake, liberalization would give them entry into a prestigious club that tilted
toward America’s orbit and away from China’s.

Closing the Export-Import Bank. The Export-Import Bank (EXIM) is an
unusually clear example of how vulnerable trade protectionism is to being hijacked
by special interests.” In most years, about half of EXIM’s business benefits a single
company, Boeing. Their relationship is so cozy that EXIM’s nickname around
Washington is “the Bank of Boeing.”

— 812 —

2025 Presidential Transition Project

Unlike most other agencies, EXIM has a charter that expires. Congress must
renew it periodically, or else the agency will permanently close. Its current charter
expires at the end of 2026. Closing this New Deal-era legacy agency would be a
conservative victory on anumber of fronts. It is also a winnable battle: Congress
just needs to do nothing.

Conservatives have both foreign policy and economic reasons to oppose
EXIM. EXIM hasa long history of providing financing for authoritarian govern-
ments in China, Russia, and the Middle East that often oppose U.S. foreign policy
interests, and its deals often oppose U.S. economic interests. EXIM financing
also harms domestic airlines. Many EXIM financing deals enable foreign state-
run airlines to buy Boeing jets at a discount. These foreign airlines, subsidized
by the U.S. government, then compete directly with US. airlines on interna-
tional routes.

More recently, the Biden Administration has expanded EXIM’s mission to
advance progressive policy goals, including limits on financing for projects that
involve fossil fuels or contribute to climate change, preferential treatment for
renewable energy projects, and quotas for projects that benefit women-owned and
minority-owned businesses. All of these could raise EXIM’s default rates, putting
taxpayer dollars at risk.

The strongest argument in EXIM’s favor is that it boosts U.S. exports by financ-
ing projects that would otherwise never receive financing. We now have evidence
that this argument is false: EXIM does not finance additional exports; instead, it
largely substitutes for other forms of export financing that would occur anyway.

EXIM’s authorization lapsed in 2014-2015 because of conservative opposition
to renewing its charter. During this lapse, EXIM maintained its existing portfo-
lio but was unable to take on new business. Boeing reported no trouble finding
alternative financing and even reported record profits during EXIM’s lapse while
working to fulfill a seven-year backlog of orders.”

EXIM boasts an extremely low default rate, but that is because of selection
bias. EXIM overwhelmingly takes on low-risk projects that private banks would
be happy to finance, although this admittedly could change somewhat with EXIM’s
Biden-era mandates to finance climate and other policy-focused projects.

EXIM is also a textbook example of regulatory capture.

e Ithas along record of deals with authoritarian governments.
e Itsubsidizes direct foreign competitors of domestic businesses.

e It has been hijacked by progressives to advance their climate and other
preferred policies.

— 813 —

Mandate for Leadership: The Conservative Promise

e Its beneficiaries have proven they can get adequate financing from
private banks.

EXIM’s charter expires at the end of 2026. The agency will close automatically
unless Congress and the President decide to extend it. Closing EXIM should be
one of the next Administration’s easiest decisions.

Adopting a Multi-Pronged China Strategy. An effective American policy
toward China needs to take a realistic view of the country, its leaders, their
strengths, and the serious challenges they face. It should be comprehensive and
flexible. A threatened CCP is dangerous, perhaps now more than at any time since
Mao Tse-Tung, as Xi Jinping continues to use strong-arm tactics to consolidate his
power and saber-rattling to challenge the international order.

At the same time, recent revelations about China’s official statistics overstating
its GDP by 30 percent track well with other problems that were already known.”
These include one of the world’s worst demographic aging curves thanks to China’s
one-child policy; a population that may already be declining; an unsustainable debt
load that is already causing problems; countless failed boondoggles, from empty
cities to its underwhelming Belt-and-Road Initiative, that are wasting significant
resources; Xi Jinping’s authoritarian turn; increasing state control of the economy;
anda zero-COVID policy that has sabotaged the economy and driven away foreign
investment.”

America has its problems, but it is in better shape than China on nearly every
measure, especially in the long run. While the facts on the ground should inoculate
the next Administration against the most strident China fearmongering circulating
in the media and in Washington, that does not mean that the government in Beijing
is no threat to American interests. The question is: What should we do about it?

A serious China policy will require American policymakers to integrate doc-
trines, institutional prerogatives, expertise, and realistic objectives. Traditional
Cabinet-level bureaucracies like those at the Departments of Defense, State, and
Commerce will need to work together to pursue a comprehensive American strat-
egy. Scores of incremental, narrowly targeted policies are necessary. They will not
make for good soundbites on cable news, and many will operate slowly and out of
sight from most news cycles even as progress is made.

An effective China policy must also allow for adaptation because the CCP will
not sit idly by. As people react to developments, America needs flexible options.
Trade isolationism is inherently inflexible because it reduces the number of con-
tact points with China.

This is a tougher political sell than loud, simplistic jeremiads, but going the extra
mile to solve these difficult coordination problems is vital to America’s interests.
Trade and engagement with China are necessary if we are to contain the threats
that China poses to its neighbors and to the U.S. The next Administration should:

— 814 —

2025 Presidential Transition Project

End China’s developing-nation status in the WTO and other
international organizations. China is an advanced manufacturing
economy and should be treated as such, even if its political and legal
institutions remain those of a developing nation, to prevent it from
exploiting its status to gain special privileges.

Use a target, not a blanket. There should be actions against Chinese firms
that are known to have engaged in unfair trade practices such as intellectual
property theft. Rather than blanket tariffs or non-tariff barriers aimed

at entire Chinese industry sectors, firms that act in bad faith should be
targeted individually. This policy was employed to good effect early in the
Trump Administration but was abandoned in favor of a less effective blanket
tariff policy.

Rejoin the Trans-Pacific Partnership. Dropping out of the Trans-Pacific
Partnership agreement might have been the Trump Administration’s
biggest trade policy mistake. The TPP was already negotiated and would
have strengthened an alliance against China, including most of its biggest
trading partners in East Asia and the Americas. America’s departure created
tensions and infighting, distracting the U.S. and its allies from the goal at
hand: countering China. The other 11 TPP countries continue, without
American input or influence, under the Comprehensive and Progressive
Agreement for Trans-Pacific Partnership (CPATPP) to develop a modern
institutional framework to contain Chinese commercial imperialism.

Rejoining this alliance should be a top priority in the next conservative
Administration’s China policy. Accession negotiations are likely to be
difficult, given that the CPATPP suspended several clauses that were
important to the United States (such as provisions relating to patents and
aspects of investor-state dispute resolution) when the U.S. pulled out of the
TPP agreement in 2017.

Diplomatic and economic pressure against Beijing will be more effective
when its largest trading partners work in concert. Beijing’s diplomats will
have a hard time employing a divide-and-conquer policy against a united
front of the sort that the TPP offers.

Refocus the Indo-Pacific Economic Framework for Prosperity
on trade. President Biden began the process to create IPEF in 2022,
but any agreement will likely still be under negotiation when the next
Administration takes office. IPEF is similar to the TPP, but its member

— 815 —

Mandate for Leadership: The Conservative Promise

countries are mostly China’s neighbors in Asia. Like the TPP, it seeks to
create an alliance to push China toward the rule of law, but the Biden
Administration so far has left trade entirely out of the agreement. Instead,
the IPEF negotiations are focusing entirely on non-trade issues like climate
and labor policy—issues that give progressives opportunities to impose their
policies on other countries and provide rent-seeking opportunities for labor
unions and politically connected businesses in renewable energy and other
favored industries.

IPEF has the potential to be a powerful diplomatic tool that helps to bring
countries into America’s orbit and away from China’s. Beijing’s chauvinistic
approach to foreign policy has alienated most of China’s neighbors and
allies. They follow along because they lack alternatives. IPEF and the TPP
could offer them a way out and make it easier for China’s smaller neighbors
to stand up for themselves in a united front as they move toward American-
style institutions that protect civil, political, and economic liberties.

IPEF could do all that, and so could the TPP, but America currently has
no voice in the TPP, and IPEF risks becoming little more than another
tool that progressives can use to force their policy wish list on countries
that don’t want it. From the perspective of IPEF’s members, the Biden
Administration’s approach is little different from Beijing’s. The next
Administration can give China’s neighbors a better choice by refocusing
IPEF on trade, dropping most of its non-trade issues, and turning it into a
forum to promote democracy and strengthen alliances while pressuring
Beijing to make needed reforms.

Play the long game. It took two generations to win the Cold War, and
there were many reasons for that success. The fact that the planned
economy is inherently inferior to free-market capitalism played a role. So
did diplomatic, military, and economic pressure from free countries. But
culture was just as important, and it did not come from any government.
Blue jeans and rock’n’ roll helped to win the Cold War as much as any
deliberate policy did. So did images of fashion and prosperity in American
movies and television shows like Dallas.

Such informal bottom-up processes will also play a vital role in helping to
turn China from an authoritarian threat into a freer and less hostile power.
It will take a long time, and the slow process will garner few headlines, but

it can work. A conservative Administration will support efforts by ordinary
Americans to engage with ordinary Chinese people through social networks,

— 816 —

2025 Presidential Transition Project

Internet memes, fashion, movies, student exchange programs, tourism,
and more. China’s leaders are set in their ways, especially with Xi Jinping
presumably now in power for life, but the younger generation is more open
than their parents were—more individualistic and open to change.

Effective outreach to the Chinese people will need the same humility that
other sound trade policies require. Government-directed cultural and
economic outreach risks being heavy-handed and could backfire. Everyone
involved needs to know that the process is generational in scope and will
not work overnight. At the very least, Washington should stay out of the way
as much as possible when regular people want to contact each other across
national, language, and cultural divides.

Each of these many components, from tariffs to trade agreements to culture,
is asmall part of a larger China policy. Many are not attention-grabbing

and cannot be put into sound bites. Cultural engagement is not something
Washington can plan. China’s own demographic and debt problems, along
with aging leadership and growing discontent over the zero-COVID policy,
might even cause an internal collapse. American policy must therefore be
prepared to face any contingency.

CONCLUSION

A conservative trade policy needs a conservative vision. America’s found-
ing institutions, based on free trade and entrepreneurship, have made America
the world’s leading economy and will help keep America strong through the
next century.

However, recent departures from those principles have hurt America’s econ-
omy and weakened alliances that are necessary to contain threats from Russia and
China. Reaffirming those principles through policies of openness, dynamism, and
free trade will boost America’s economy, make us more resilient against crises, and
remove opportunities for progressives and rent-seekers to use the levers of gov-
ernment for their own purposes. Rediscovering conservative principles on trade
policy and embracing America’s long history as the world’s leading commercial
republic are an important part of restoring a government of, by, and for the people.

AUTHOR’S NOTE: The preparation of this analysis could not have been completed without the valuable
support of a small, sturdy, and principled community of trade policy experts. Among them, my colleagues at the
Competitive Enterprise Institute, Ryan Young, lain Murray, and Ivan Osorio were essential. The author alone is
responsible for this report. No views herein should be attributed to any other individual or institution.

— 817 —

Mandate for Leadership: The Conservative Promise

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For a historical example, see Douglas A

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Ad.

AS.

46.

4].

48.

49.

50.

52.

53.

54.

D0)

56.

aye

58.

59:

2025 Presidential Transition Project

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Constitution Center, https://cons

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Wells King, “Rediscovering a Genui
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ican Compass, Rebooting the American System,
nuine-american-system/ (accessed February 21,

2023). See also Phillio W. Magness
American Economy,” American Ins
henry-clays-american-sys
urray, “The Founding Fa
20, 2022, https://cei.org/b
Douglas A.
2018), pp. 147-154.
bid., p. 125.
ichael Urquhart, “The Employmen
Bureau of
mir/1984/04/art2full.odf (accessed F:
H.R. 10378, Merchant Marine Act of

og/the-

Tori K. Smith, “The Proof Is In: Tariffs

H.R. 11970, Trade Expansion Act o
govinfo.gov/content/pkg/STATUT!
H.R. 10710, Trade Act of 1974, Pub
gov/93/statute/STATUTE-88/STAT
U.S. Constitution, Article |, Section
February 22, 2023).
Gary Clyde Hufbauer and Eujin J
Peterson Institu

Ng,

ary Amiti, S
Federal Reserve Bank 0
newyorkfed.org/2019/05/new-china-
Federal Reserve Bank of St. Louis, Fe
Labor Force Level,” https://fred.stlou
Stephen Morgan, “Retaliatory Tariffs

and James R. Harrigan, “He
itute for Economic Research

hers and Free Trade,” Competitive En

UTE-88-Pg1978-2.pd

e for International Econ
https://www.piie.com/blogs/trade-and-investment-poli
rumps (accessed February 21, 2023).
ephen J. Redding, and David E. Weinstein,
New York, Liber

Department of Agriculture, Economic

nry Clay’s ‘American System’ Is Bad
, December 8, 2022, https://www.aier.org/article/
em-is-bad-news-for-the-american-economy/ (accessed February 21, 2023), and lain
terprise Institute, Open Market Blog, September
ounding-fathers-and-free-trade/ (accessed February 21, 2023).

Irwin, Clashing over Commerce: A History of U.S. Trade Policy (Chicago: University of Chicago Press,

ews for the

Shift to Services: Where Did it Come From?” U.S. Department of Labor,

ebruary 21, 2023).

Are Hurting the U.S.,” Heritage Fou

y 21, 2023).

Labor Statistics, Monthly Labor Review, Vol. 107, No. 4 (April 1984), p. 16, https://stats.bls.gov/opub/

920, Public Law 66-261, 66th Congress, June 5, 1920, https://govtrackus.
s3.amazonaws.com/legislink/pdf/stat/41/STATUTE-41-Pg988.pdf (accessed February 22, 2023.

ndation Commentary, August 27, 2019,

https://www.heritage.org/trade/commentary/the-proof-tariffs-are-hurting-the-us.

Congressional Budget Office, The Budget and Economic Outlook: 2020 to 2030, January 2020, p. 33, https://
www.cbo.gov/publication/56073 (accessed Februa
1962, Public Law
E-76/pdf/STAT
ic Law No. 93-618

No. 87-794, 87th Congress, October 11, 1962, https://www.
UTE-76-Pg872.pdf (accessed February 22, 2023).

, 93rd Congress, January 3, 1975, https://www.congress,
(accessed February 22, 2023).

https://constitution.congress.gov/constitution/article-I/ (accessed

“Steel Profits Gain, but Steel Users

“New China Tarif
y Stree
ariffs-increase-cos
deral Reserve Economic Database

Reduced U.S. States’ Exports of Ag

Pay, Under Trump’s Protectionism,”

omics, /rade and Investment Policy Watch, December 20, 2018,
cy-watch/steel-profits-gain-steel-users-pay-under-

s Increase Costs to U.S. Households,”

Economics Blog, May 23, 2019, https://libertystreeteconomics.
s-to-us-households/ (accessed February 21, 2023).

FRED), Series CLFI6OV, “Civilian

isfed.org/series/CLFI60V (accessed February 21, 2023).

ricultural Commodities,” U.S.

Research Service, Amber Waves,

gov/amber-waves/2022/march/reta
(accessed February 21, 2023).

Aaron Flaaen and Justin Pierce, “Disentangling the Ef

U.S. Manufacturing Sector,” Board of
Discussion Series

iatory-ta

, 2023); U.S. Department of

mary

https://www.bls.gov/iag/tgs/iag331.htm (accessed February 21, 2023).
Ryan Young, “Lessons from the GM layoffs: End the Tariffs and the Subsidies,” Fox Business, November 28,

2018, https://www.
(accessed February 21, 2023).

oxbusiness.com/markets/lessons-

rom-the-gm-layo

— 821—

arch 7, 2022, https://www.ers.usda.

iffs-reduced-u-s-states-exports-of-agricultural-commodities/

ects of the 2018-2019 Tariffs on a Globally Connected

Governors of the Federal Reserve System, Finance and Economics

0. 2019-086, December 23, 2019, httos://www.federalreserve.gov/econres/feds/
files/2019086pap.pdf (accessed February 2

“Data Tools: Industries at a Glance: Pri

Labor, Bureau of Labor Statistics,

etal Manufacturing: NAICS 331,” data extracted February 17, 2023,

ffs-end-the-tariffs-and-the-subsidies

60.

61.

62.

63.

64,

65.

66.

67.

68.

69.

70.
71.

72.

73.

74,

76.

Mandate for Leadership: The Conservative Promise

Irwin, Clashing over Commerce, pp. 400-410. For a book-length treatment of Smoot-Hawley, see Douglas A.
Irwin, Peddling Protectionism: Smoot-Hawley and the Great Depression, (Princeton, NJ: Princeton University
Press, 2011).

Kevin D. Williamson, Big White Ghetto: Dead Broke, Stone-Cold Stupid, and High on Rage in the Dank Wooly
Wilds of the “Real America (Washington: Regnery, 2020).

Stephen J. Hicks and Srikant Devaraj, “The Myth and Reality of Manufacturing in America,’ Conexus Indiana
and Ball State University Center for Business and Economic Research, June 2015 and April 2017, https://
conexus.cberdata.org/files/MfgReality.odf (accessed February 21, 2023).

Economic News Release, “Job Openings and Labor Turnover Summary,” U.S. Department of Labor, Bureau

of Labor Statistics, February 1, 2023, httos://www.bls.gov/news.release/jolts.nr0.htm (accessed February 21,
2023). The release reports “Job Openings and Labor Turnover—December 2022.”

Allen H. Meltzer, A History of the Federal Reserve, Volume 1: 1913-1957 (Chicago: University of Chicago Press,
2004); Allen H. Meltzer, A History of the Federal Reserve, Volume 2, Book 2, 1970-1986 (Chicago: University of
Chicago Press, 2014).
John B. Taylor, Getting Off Track: How Government Actions and Interventions Caused, Prolonged, and
orsened the Financial Crisis (Stanford, CA: Hoover Institution Press, 2009); Scott Sumner, The Money
Illusion: Market Monetarism, the Great Recession, and the Future of Monetary Policy (Chicago: University of
Chicago Press, 2021), pp. 267-284.

Federal Reserve Bank of St. Louis, Federal Reserve Economic Database (FRED), Series Unemployment Rate
(UNRATE), updated February 3, 2023, https://fred.stlouisfed.org/series/UNRATE (accessed February 21, 2023).
Ryan Young, “How to Make Sure Reformed #NeverNeeded Regulations Stay That Way,” Competitive
Enterprise Institute, Open Market Blog, July 8, 2020, https://cei.org/studies/how-to-make-sure-reformed-
neverneeded-regulations-stay-that-way/ (accessed February 21, 2023).

H.R. 8351, Formula Act, Public Law No. 117-160, 117th Congress, July 21, 2022, https://www.congress.gov/117/
plaws/publl60/PLAW-117publl60.pdf (accessed February 22, 2023).

ain Murray, “A New Kind of Trade Agreement,” Competitive Enterprise Institute, Open Market Blog,
September 19, 2018, https://cei.org/opeds_articles/a-new-kind-of-trade-agreement/ (accessed

February 21, 2023).
See note 8, supra.
ario Loyola, “America Last: The Grim Reality of the Jones Act,” Competitive Enterprise Institute /ssue
Analysis 2020 No. 5, June 2020, https://cei.org/sites/default/files/Mario_Loyola_-_America_Last.pdf
(accessed February 21, 2023); Patrick Tyrell, “Permanent Repeal of the Jones Act Would Be a Winning
Response to COVID-19,” Heritage Foundation Commentary, April 7, 2020, httos://www.heritage.org/trade/
commentary/permanent-repeal-the-jones-act-would-be-winning-response-covid-19.

Bryan Riley, “Better Trade and Regulatory Policies Are Key to Battling High Prices,” National Taxpayers Union
Blog, January 12, 2023, httos://www.ntu.org/publications/detail/better-trade-and-regulatory-policies-are-key-
o-battling-high-prices (accessed February 21, 2023).
Daniel Ikenson, Simon Lester, and Daniel Hannan, eds., “The Ideal U.S.-U.K. Free Trade Agreement: A
Free Trader's Perspective,” Initiative for Free Trade and Cato Institute, 2018, https://www.cato.org/sites/
cato.org/files/oubs/pdf/ideal-us-uk-free-trade-agreement-executive-summary-update.pdf (accessed
February 21, 2023).
John Hulsman, “The World Turned Right-Side Up: A New Trading Agenda for the Age of Globalization,”
Heritage Foundation Report, January 24, 2000, https://www.heritage.org/trade/report/the-world-turned-
right-side-new-trading-agenda-the-age-globalization.
Diane Katz, “Export-Import Bank: Propaganda Versus the Facts,” Heritage Foundation /ssue Brief No. 4430,
July 13, 2015, http://thf_media.s3.amazonaws.com/2015/pdf/IB4430.pdf; Ryan Young, “Ten Reasons to
Abolish the Export-Import Bank: Eighty Years Is Enough,” Competitive Enterprise Institute OnPoint No. 195,
July 15, 2014, http://cei.org/sites/default/files/Ryan%20Young%20-%20T0p%2010%20Reasons%20t0%20
Abolish%20Ex-1m%20%282%29.pdf (accessed February 21, 2023).

Veronique de Rugy, “Boeing Isn’t Exactly Pleased with Ex-Im’s Liquidation,” National Review Online, The
Corner, September 1, 2015, https://www.nationalreview.com/corner/ex-im-bank-boeing-liquidation/ (accessed
February 21, 2023).

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77.

78.

2025 Presidential Transition Project

Luis Martinez, “How Much Should We Trust the Dictator’s GDP Growth Estimates?” Becker-Friedman Institute
for Economics at the University of Chicago, Working Paper No. 2021-78, July 2021, https://bfi.uchicago.edu/
wp-content/uploads/2021/07/BFI_ WP_2021-78.pdf (accessed February 21, 2023).

Nicholas R. Lardy, The State Strikes Back: The End of Economic Reform in China? (Washington: Peterson
Institute for International Economics, 2019); Elizabeth C. Economy, The Third Revolution: Xi Jinping and the
New Chinese State (Oxford and New York: Oxford University Press, 2018).

— 823 —

Section Five

INDEPENDENT
REGULATORY
AGENCIES

n addition to the executive departments and agencies discussed previously,
a number of independent commissions exist that are loosely affiliated with
the executive branch. In general, the President can appoint people to these
commissions but cannot remove them, which makes them constitutionally prob-
lematic in light of the Constitution’s having vested federal executive power in the
President. Nevertheless, they exist, their constitutional legitimacy has generally
been upheld by the courts, and there will be an opportunity for the next Adminis-
tration to use them as forces for good, particularly by making wise appointments.
Few appointments to these commissions will be as important as the President’s
selection of the next chairman of the Federal Communications Commission (FCC).
In Chapter 28, FCC Commissioner Brendan Carr writes that the FCC chairman “is
empowered with significant authority that is not shared” with other FCC members.
Under a new chairman, he writes, “[t]he FCC needs to change course and bring new
urgency to achieving four main goals: [reining in Big Tech; [p]romoting national
security; [u]Jnleashing economic prosperity; and [e]nsuring FCC accountability
and good governance.”

“The FCC,” writes Carr, “has an important role to play in addressing the threats
to individual liberty posed by corporations that are abusing dominant positions
in the market.” Nowhere is that clearer “than when it comes to Big Tech and its
attempts to drive diverse political viewpoints from the digital town square.” Carr
writes that the FCC should require more transparency from Big Tech, which today

“offers a black box.” And it should issue “an order that interprets Section 230”—
which provides protection from legal liability to online computer services that

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Mandate for Leadership: The Conservative Promise

moderate content in good faith—“in a way that eliminates the expansive, non-tex-
tual immunities that courts have read into the statute.” In addition to taking

unilateral action, Carr says, the FCC should work with Congress on legislative

changes to ensure that “Internet companies no longer have carte blanche to censor

protected speech while maintaining their Section 230 protections.”

Carr writes that during the Trump Administration, the FCC took an “appro-
priately strong approach to the national security threats posed by the Chinese
Communist Party.” The FCC put Huawei on its Covered List of entities—its list
of those posing “an unacceptable risk” to U.S. national security. Carr writes that
TikTok also poses a “serious and unacceptable” risk to U.S. national security, while
providing “Beijing with an opportunity to run a foreign influence campaign by
determining the news and information that the app feeds to millions of Americans,”
and the next Administration should ban it. What’s more, Carr writes, “U.S. busi-
nesses are aiding Beijing—often unwittingly”—in its effort to become, by 2030, “the
global leader in artificial intelligence.” In part, they are doing so by providing “Bei-
jing access to their high-powered cloud computing services.” Carr asserts that “it is
time for an Administration to put in place a comprehensive plan that aims to stop
US. entities from directly or indirectly contributing to China’s malign AI goals .”

Former Federal Election Commissioner Hans von Spakovsky writes in Chap-
ter 29 that while “the authority of the President over the actions of” the Federal
Election Commission “is extremely limited,” the President “must ensure that the
[Justice Department], just like the FEC, is directed to only prosecute clear viola-
tions” of the Federal Election Campaign Act. “The department must not construe
ambiguous provisions...in a way that infringes on protected First Amendment
activity,” he writes. The FEC has six members, three from each party, and its
determinations require a majority—so, they require the support of at least one
member of each party. DOJ should not “prosecute an individual for supposedly
violating the law when the FEC has previously determined that a similarly situated
individual has not violated the law,” writes von Spakovsky. Moreover, he writes
that the “President should vigorously oppose all efforts”—such as the language
in the “For the People Act of 2021”—“to change the structure of the FEC” so that
it would have an “odd number” of members. The current structure “ensures that
there is bipartisan agreement before any action is taken and protects against the
FEC being weaponized.”

In Chapter 27, David R. Burton writes that the Securities and Exchange Com-
mission (SEC) “should be reducing impediments to capital formation, not radically
increasing them” by pushing a costly “climate change” agenda, as it is doing under
the Biden Administration. Discussing the Federal Trade Commission, Adam Can-
deub writes in Chapter 30, “Antitrust law can combat dominant firms’ baleful
effects on democratic” notions—“such as free speech, the marketplace of ideas,
shareholder control, and managerial accountability as well as collusive behavior

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2025 Presidential Transition Project

with government.” Under the Biden FTC, he writes, firms try “to get out of anti-
trust liability by offering climate, diversity, or other forms of ESG-type offerings.”
Candeub says that state AGs “are far more responsive to their constituents” than
the federal government generally is, and he recommends that the FTC establish
a position in the chairman’s office that is “focused on state AG cooperation and
inviting state AGs to Washington, DC, to discuss enforcement policy in key sectors
under the FTC’s jurisdiction: Big Tech, hospital mergers, supermarket mergers,

and so forth.”

— 827 —

FINANCIAL
REGULATORY
AGENCIES

SECURITIES AND EXCHANGE COMMISSION
AND RELATED AGENCIES
David R. Burton
he primary purposes of the laws and regulations governing capital markets and
of capital market regulators are to deter and punish fraud and other material
misstatements to investors; foster reasonable, scaled disclosure of information
that is material to investors’ financial outcomes and proxy voting decisions; and
maintain fair, orderly, and efficient secondary capital markets.

The Securities Act of 1933' and the Securities Exchange Act of 1934? reflect
nearly nine decades of rushed and haphazard amendments. The securities laws
are now extremely complex and do not constitute a coherent, rational regulatory
regime. For example, the current SEC has proposed a climate change reporting
rule that would quadruple the costs of being a public company.’ This would have
a substantial adverse impact on existing companies. Over time, it would also sub-
stantially reduce the number of public companies and therefore the number of
investing options available to ordinary Americans. The Securities and Exchange
Commission (SEC) should be reducing impediments to capital formation, not rad-
ically increasing them.

The SEC and Congress should fundamentally reform the securities laws gov-
erning issuers, broker-dealers, exchanges, and other market participants. Among
other things, they should establish a simplified and rationalized securities disclo-
sure system with:

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Mandate for Leadership: The Conservative Promise

e Three basic categories of firm: private firms, an intermediate category of
smaller firms,’ and public firms;

e Reasonable, scaled disclosure requirements; and
e Specified secondary markets for the securities of these firms.°

The SEC needs to be reformed to achieve its important core functions more
effectively, to improve transparency and due process, and to reduce unnecessary
regulatory impediments to capital formation.® Under current law, the SEC Chair-
man has the authority to make almost all of the necessary changes.’ Unfortunately,
financial regulators, particularly the SEC and the Financial Industry Regulatory
Authority (FINRA), are poorly managed and organized.

With regulatory authority delegated by the government, both the Public
Company Accounting Oversight Board (PCAOB) and FINRA have proved to be
ineffective, costly, opaque, and largely impervious to reform. To reduce costs and
improve transparency, due process, congressional oversight, and responsiveness,
PCAOB and FINRA should be abolished, and their regulatory functions should
be merged into the SEC. Furthermore, Congress should establish an indepen-
dent board or commission and charge it with producing a detailed report within
18 months that examines the degree to which the regulatory functions of the var-
ious other so-called self-regulatory organizations (SROs), which are no longer
self-regulatory in any meaningful sense, should be moved to the SEC.8

Discrimination based on immutable characteristics has no place in financial
regulation. Offices at financial regulators that promote racist policies (usually in
the name of “diversity, equity, and inclusion”) should be abolished, and regulations
that require appointments on the basis of race, ethnicity, sex, or sexual orientation
should be eliminated. Equal protection of the law, equal opportunity, and individ-
ual merit should govern regulatory decisions.®

Congress has given the SEC broad “general exemptive authority,””° but the SEC
has used this authority only rarely. It should use this authority significantly more
often to reduce the regulatory burden on issuers, particularly smaller entrepreneurs.

ENTREPRENEURIAL CAPITAL FORMATION
Financial regulators should remove regulatory impediments to entrepreneur-

ial capital formation." In the absence of the fundamental reform outlined above,
the SEC should:

e Simplify and streamline Regulation A (the small issues exemption)” and

Regulation CF (crowdfunding) and preempt blue sky registration and quali-
fication requirements for all primary and secondary Regulation A offerings.*

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2025 Presidential Transition Project

Either democratize access to private offerings by broadening the definition
of accredited investor for purposes of Regulation D or eliminate the
accredited investor restriction altogether.’

Allow traditional self-certification of accredited investor status for all
Regulation D Rule 506 offerings.

Exempt small micro-offerings from registration requirements.”°

Exempt small and intermittent finders from broker-dealer registration
requirements and provide a simplified registration process for private
placement brokers.”

Exempt peer-to-peer lending from federal and state securities laws and
reduce the regulatory burden on Regulation CF debt securities.

Make the Title I Emerging Growth Company (EGC) exemptions permanent
for all EGCs.

Reduce the regulatory burden on small broker-dealers and exempt privately
held, non-custodial broker-dealers from the requirements to use a PCAOB-
registered firm for their audits.

Congress should:
Amend the Internal Revenue Code to disregard crowdfunding and

Regulation A shareholders for purposes of the 100-shareholder limit for
Subchapter S corporations.®

BETTER CAPITAL MARKETS

To improve capital markets, the SEC should:
Preempt blue sky registration, qualification, and continuing reporting
requirements for securities traded on established securities markets
(including a national securities exchange or an alternative trading system).””
Terminate the Consolidated Audit Trail (CAT) program.”°
Abolish Rule 144 and other regulations that restrict securities resales and instead

require acompany that has sold securities to provide sufficient current informa-
tion to the market to permit reasonable investment decisions and secondary sales.

— 831 —

Mandate for Leadership: The Conservative Promise

Congress should:

Prohibit the SEC from requiring issuer disclosure of social, ideological,
political, or “human capital” information that is not material to investors’
financial, economic, or pecuniary risks or returns. The proposed SEC
climate change rule, which would quadruple the costs of being a public
company, is particularly problematic.”!

Repeal the Dodd—Frank mandated disclosures relating to conflict minerals,
mine safety, resource extraction, and CEO pay ratios.”

Oppose efforts to redefine the purpose of business in the name of social
justice; corporate social responsibility (CSR); stakeholder theory;
environmental, social, and governance (ESG) criteria; socially responsible
investing (SRD; sustainability; diversity; business ethics; or common-
good capitalism.

Prohibit securities regulators, including SROs, from promulgating rules
or taking other actions that discriminate, either favorably or unfavorably,
on the basis of the race, color, religion, sex, or national origin of such
individual or group.

SEC ADMINISTRATION

To enable it to achieve its core mission more effectively, the SEC should:

Publish better data on securities offerings, securities markets, and
securities law enforcement and publish an annual data book of time

series data on these matters. Specifically, the SEC Division of Economic

and Risk Analysis (DERA) needs to do a much better job of collecting and
reporting fundamental data regarding offerings, regulatory costs, violations,
enforcement, investors, state regulator taxes, fees and activities, and

other matters.

Ensure that SEC resources flow toward its core functions and away from
ancillary and support functions or from missions that do not fall within the
SEC’s statutory charge.

Ensure that any three SEC Commissioners are empowered to place an item

on the agenda and to receive adequate staff support to do so even without
the Chairman’s support.

— 832 —

2025 Presidential Transition Project

Eliminate all administrative proceedings (APs) within the SEC except
for stop orders related to defective registration statements. The SEC
enforcement system does not need to have both district court cases and
APs. Alternatively, respondents should be allowed to elect whether an
adjudication occurs in the SEC’s administrative law court or an ordinary
Article III federal court.**

End the practice of delegating the decision to initiate an enforcement case.
The SEC Chairman—and possibly the U.S. Government Accountability
Office (GAO)—should study whether other Commission delegation of
authority to staff should be narrowed and whether sunsetting of such
delegation of authority should be required.

Congress should:
Require an Inspector General’s (or possibly a GAO) report regarding SEC
information technology spending and contracting. Spending appears to be
much too high, and IT contracting is poorly managed.
Statutorily limit the time for an investigation to two years with no
extensions. Long investigations harm private parties and the quality of
justice. With adequate management processes, the SEC should not need
more than two years even for complicated matters.

The SEC Chairman should:
Dramatically reduce the number of direct reports to the SEC Chairman.

Merge SEC offices that are performing similar functions.

Reduce the number of managers per employee.

CFTC ADMINISTRATION AND IMPROVED
COMMODITIES AND DERIVATIVES MARKETS

Congress should:

Modernize the definition of commodity (which is now largely a laundry list
of agricultural commodities)” and clarify the treatment of digital assets.

Clarify through an express amendment to the Commodity Exchange Act
(CEA)”* the circumstances that require a foreign swap trading platform to

— 833 —

Mandate for Leadership: The Conservative Promise

register with the Commodity Futures Trading Commission (CFTC) as aswap
execution facility (SEF) under Sections 2)” and 5h” of the CEA. Currently, it
is not clear whether having one or a small number of U.S. participants would
require SEF registration under prior staff guidance, which has led foreign
swap trading platforms to exclude all U.S. persons from their platforms or to
go through the process of seeking an exemption from registration.

Amend Section 2 of the CEA to authorize the CFTC Chairman to remove the
agency’s Executive Director without a Commission vote.

To augment Commissioners’ independence, establish funding amounts for
the Commissioners’ offices by statute with adjustments for inflation, with
no requirement for a Commissioner to obtain budget or expense approvals
from the Chairman or the agency’s administrative staff.

The CFTC should:

Allocate more resources to core agency functions rather than ancillary and
support operations.

Replace the existing position limits rule, which reduces liquidity and makes
markets more volatile, with further delegation of authority to the exchanges
to set position limits and position accountability levels where appropriate
for the relevant market.

Reduce overly prescriptive rules implementing the CFTC’s core principles.

Apply the definitions of “U.S. Person” and “Guarantee” in the CFTC’s 2020
rule on cross-border application of swaps regulations (2020 Cross-Border
Rule)” to the regulatory requirements that remain covered by the CFTC’s
2013 guidance on the subject (2013 Guidance).*° Currently, the definition
of each of these foundational terms differs depending on whether the
requirement in question is covered by the 2020 Cross-Border Rule or the
2013 Guidance.

Remove the regulatory categories of “affiliate conduit” and “foreign
consolidated subsidiary” from the 2013 Guidance and the CFTC’s cross-
border rule on margin for uncleared swaps,” respectively. These categories
were replaced by the concept of a “Significant Risk Subsidiary” for purposes
of the 2020 Cross-Border Rule because of widespread market confusion and
compliance difficulties arising from their broad and vague scope.

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2025 Presidential Transition Project

DIGITAL ASSETS

Both the SEC and the CFTC have been irresponsible actors in the digital asset
area. They have had more than a decade to promulgate rules governing digital
assets, yet the SEC has utterly failed to do so, and the CFTC has provided only
minimal guidance. Instead, both agencies have chosen regulation by enforce-
ment—and have done it poorly. They neither adequately protect investors nor
provide responsible market participants with the regulatory environment that
they need to thrive.

The SEC and CFTC should clarify the treatment of digital assets (coins or
tokens). Specifically, they should:

e Promulgate a joint regulation providing that a holder of digital assets may
not be deemed a party to an investment contract or an investor ina common
enterprise unless, while the enterprise is a going concern, the holder is
entitled to a share of the earnings or profits of the common enterprise or
a defined flow of payments from the common enterprise in consideration
of the investment or unless, upon liquidation, the holder has rights against
the assets of the common enterprise. Otherwise, the digital asset shall be
deemed a commodity to be regulated by the CFTC, not the SEC.

e Amend the definition of commodity to include digital assets that are not
a security as so defined and amend the definition of security to make it
clear that a certificate (digital, electronic, or otherwise) that represents
ownership of commodities and is convertible into a physical commodity on
demand is not a security but a commodity.

In the absence of regulatory action, Congress should enact legislation that
achieves these goals.

IMPROVED REGULATION OF THE INDUSTRY AND SROS

Congress and the SEC need to conduct more robust oversight of self-regulatory
organizations, and SROs need to be reformed; otherwise, as discussed above, SRO
regulatory functions should be merged into the SEC. The SEC, FINRA itself, or
Congress should:

e Inthe absence of merging FINRA into the SEC as recommended,
require that:

1. FINRA’s Board of Governors meetings be open to the public unless the
board votes to meet in executive session.

— 835 —

Mandate for Leadership: The Conservative Promise

2. FINRA’s Board of Governors’ agenda be made available to the
public in advance.

3. Board minutes describing actions taken be published without delay.

4. FINRA make available to the public in advance rulemakings that the
FINRA board is expected to consider.

5. FINRA arbitration and disciplinary hearings should be open to the
public and reported.

Require FINRA arbitrators to make findings of fact based on the evidentiary
record and demonstrate how those facts led to the award given (except with
respect to very small claims). These written FINRA arbitration decisions
should be subject to SEC review and limited judicial review.

Require that all SRO fines, including those imposed by FINRA, should
go either to a newly established investor reimbursement fund or to the
Treasury. SROs should not have a financial interest in imposing fines.

Require all SROs to conduct meaningful cost-benefit analysis as part of the
rulemaking process with respect to major rules.

Require all SROs to publish rules in proposed format and seek public
comment before they are submitted to the SEC or the CFTC.

Require each SRO to submit an annual report to Congress with detailed,
specified information about its budget and fees; its enforcement activities
(including sanctions and fines imposed by type of violation and type of firm
or individual); its dispute resolution activities; and its rulemaking activities.

Congress should:
Conduct annual oversight hearings on SROs.
Either make FINRA, the Municipal Securities Rulemaking Board (MSRB),
and the National Futures Association (NFA) “Designated Federal Entities”
and establish an inspector general with respect to financial SROs, including

FINRA, the MSRB, and the NFA or place FINRA, the MSRB, and the NFA
within the ambit of an existing inspector general.

— 836 —

2025 Presidential Transition Project

e Require the SEC and the CFTC to publish a detailed annual report on SRO
supervision.

AUTHOR'S NOTE: The preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but Paul
Atkins, C. Wallace DeWitt, Christopher lacovella, Brian Knight, Chelsea Pizzola, and Andrew Vollmer deserve special
mention. The author alone assumes responsibility for the content of this chapter, and no views expressed herein
should be attributed to any other individual.

CONSUMER FINANCIAL PROTECTION BUREAU
Robert Bowes
he Consumer Financial Protection Bureau (CFPB) was authorized in 2010
by the Dodd-Frank Act.” Since the Bureau’s inception, its status as an “inde-
pendent” agency with no congressional oversight has been questioned in multiple
court cases, and the agency has been assailed by critics*? as a shakedown mecha-
nism to provide unaccountable funding to leftist nonprofits politically aligned with
those who spearheaded its creation.

In 2015, for example, Investor’s Business Daily accused the CF PB of “diverting
potentially millions of dollars in settlement payments for alleged victims of lending
bias to a slush fund for poverty groups tied to the Democratic Party” and plan-
ning “to create a so-called Civil Penalty Fund from its own shakedown operations
targeting financial institutions” that would use “ramped-up (and trumped-up)
anti-discrimination lawsuits and investigations” to “bankroll some 60 liberal non-
profits, many of whom are radical Acorn-style pressure groups.”**

The CFPB has a fiscal year (FY) 2023 budget of $653.2 million® and 1,635 full-
time equivalent (FTE) employees.*° From FY 2012 through FY 2020, it imposed
approximately $1.25 billion in civil money penalties;*’ in FY 2022, it imposed
approximately $172.5 million in civil money penalties.** These penalties are
imposed by the CFPB Civil Penalty Fund, described as “a victims relief fund, into
which the CFPB deposits civil penalties it collects in judicial and administrative
actions under Federal consumer financial laws.”*?

The CF PB is headed by a single Director who is appointed by the President to
a five-year term.*° Its organizational structure includes five divisions: Operations;
Consumer Education and External Affairs; Legal; Supervision, Enforcement and
Fair Lending; and Research, Monitoring and Regulations." Each of these divisions
reports to the Office of the Director, except for the Operations Division, which
reports to the Deputy Director.

Passage of Title X of Dodd-Frank was a bid to placate concern over a series
of regulatory failures identified in the wake of the 2008 financial crisis. The law
imported a new superstructure of federal regulation over consumer finance and

— 837 —

Mandate for Leadership: The Conservative Promise

mortgage lending and servicing industries traditionally regulated by state bank-
ing regulators. Consumer protection responsibilities previously handled by the

Office of the Comptroller of the Currency, Office of Thrift Supervision, Federal

Deposit Insurance Corporation, Federal Reserve, National Credit Union Admin-
istration, and Federal Trade Commission were transferred to and consolidated in

the CFPB, which issues rules, orders, and guidance to implement federal consumer

financial law.

The CFPB collects fines from the private sector that are put into the Civil Pen-
alty Fund.” The fund serves two ostensible purposes: to compensate the victims
whom the CFPB perceives to be harmed and to underwrite “consumer education”
and “financial literacy” programs.** How the Civil Penalty Fund is spent is at the
discretion of the CFPB Director. The CFPB has been unclear as to how it decides
what “consumer education” or “financial literacy programs” to fund.“ As noted,
critics have charged that money from the Civil Penalty Fund has ended up in the
pockets of leftist activist organizations.

In Seila Law LLC v. Consumer Financial Protection Bureau, the Supreme Court
of the United States held that the CFPB’s leadership by a single individual remov-
able only for inefficiency, neglect, or malfeasance violated constitutional separation
of powers requirements because “[t]he Constitution requires that such officials
remain dependent on the President, who in turn is accountable to the people.”*°
The CFPB Director is thus subject to removal by the President.

The CFPB is not subject to congressional oversight, and its funding is not
determined by elected lawmakers in Congress as part of the typical congressional
appropriations process. It receives its funding from the Federal Reserve, which
is itself funded outside the appropriations process through bank assessments.
CFPB funding represents 12 percent of the total operating expenses of the Fed-
eral Reserve and is disbursed by the unelected Board of Governors of the Federal
Reserve System.” This is not the case with respect to any other federal agency.

On October 19, 2022, in Community Financial Services Association of America
v. Consumer Financial Protection Bureau, the U.S. Court of Appeals for the Fifth
Circuit held that the CFPB’s “perpetual insulation from Congress’s appropriations
power, including the express exemption from congressional review of its funding,
renders the Bureau ‘no longer dependent and, as a result, no longer accountable’
to Congress and, ultimately, to the people”* and that “[b]y abandoning its ‘most
complete and effectual’ check on ‘the overgrown prerogatives of the other branches
of the government’—indeed, by enabling them in the Bureau’s case—Congress ran
afoul of the separation of powers embodied in the Appropriations Clause.” The
Court further remarked that the CFPB’s “capacious portfolio of authority acts ‘as
amini legislature, prosecutor, and court, responsible for creating substantive rules
for a wide swath of industries, prosecuting violations, and levying knee-buckling

penalties against private citizens.”°°

— 838 —

2025 Presidential Transition Project

On February 27, 2023, the Supreme Court granted the petition for a writ of
certiorari.” The Court should issue its final decision by 2024.

The CFPBis a highly politicized, damaging, and utterly unaccountable federal
agency. It is unconstitutional. Congress should abolish the CFPB and reverse
Dodd-Frank Section 1061, thus returning the consumer protection function of
the CFPB to banking regulators®™ and the Federal Trade Commission. Provided
the Supreme Court affirms the Fifth Circuit holding in Community Financial Ser-
vices Association of America, the next conservative President should order the
immediate dissolution of the agency—pull down its prior rules, regulations and
guidance, return its staff to their prior agencies and its building to the General
Services Administration.

Until this can be accomplished, however, Congress should:

e Ensure that any civil penalty funds not used to recompense wronged
consumers go to the Department of the Treasury. The funds should not
be retained by the Bureau to be dispensed at the pleasure of the Director—
potentially to political actors. Moreover, the CFPB should not have a
financial incentive to impose penalties.

e Repeal Dodd-Frank Section 1071. This section, which relates to small-
business data collection, imposes requirements on financial institutions’
lending to small firms, raises costs, and limits small businesses’ access
to capital.**

e Require that no CFPB funds are spent on enforcement actions that
are not based on a rulemaking that complies with the Administrative
Procedure Act.”

e Require that respondents in administrative actions be allowed to
elect whether an adjudication occurs in an administrative law court

or an ordinary Article III federal court.*°

e ©6Specify the nature of “deceptive, unfair, and abusive” practices to
define the scope of the CFPB mission more precisely.

— 839 —

Mandate for Leadership: The Conservative Promise

ENDNOTES

H.R. 5480, Securities Act of 1933, Public Law No. 73-22, 73rd Congress, May 27, 1933, https://govtrackus.
s3.amazonaws.com/legislink/pdf/stat/48/STATUTE-48-Pg74.pdf (accessed February 20, 2023).
H.R. 9323, Securities Exchange Act of 1934, Public Law No. 73-291, 73rd Congress, June 6, 1934, https://

govtrackus.s3.amazonaws.com/legislink/pdf/stat/48/STATUTE-48-Pg88la.
Mark T. Uyeda, Commissioner, U.S. Securities and Exchange Commission, “

pdf (accessed February 20, 2023).
Remarks at the 2022 Cato

Summit on Financial Regulation,” November 17, 2022, https://www.sec.gov/news/speech/uyeda-remarks-

cato-summit-financial-regula

on-111722 (accessed February 20, 2023); Hester M. Peirce, Commissioner, U.S.

Securities and Exchange Commission, “It’s Not Just Scope 3: Remarks at the American Enterprise Institute,”
December 7, 2022, https://www.sec.gov/news/speech/peirce-remarks-american-enterprise-institute-120722

(accessed February 20, 2023);

comment letter from David R. Burton to Vanessa A. Countryman, Secretary,
Securities and Exchange Commission, “Re: The Enhancement and Standardization of Climate-Related

Disclosures for Investors [File No. S7-10-2; Release No. 33-11042: RIN 3235-AM87],” June 17, 2022, https://www.

sec.gov/comments/s7-10-22/s71022-20131980-302443.pdf (accessed February 20, 2023).
Size would probably be measured best by public float or the number of beneficial owners.

See David R. Burton, “Securities Disclosure Reform,” Heritage Foundation Backgrounder No. 3178, February

13, 2017, https://www.heritage.org/sites/default/files/2017-02/BG3178.pdf;

David R. Burton, “Offering and

Disclosure Reform,” Chapter 11 in Reframing Financial Regulation: Enhancing Stability and Protecting

Consumers, ed. Hester Peirce and Benjamin Klutsey (Arlington, VA: Mercat

us Center at George Mason

University, 2016), pp. 277-315, httos://www.mercatus.org/research/books/reframing-financial-regulation

(accessed February 20, 2023); Andrew N. Vollmer, “Investor-Friendly Secu

Growth,” Securities Regulation & Law Report, Bloomberg BNA, Vol. 49, June 5, 2017.

rities Reform to Increase Economic

See, for example, David R. Burton, “Reforming the Securities and Exchange Commission,” Heritage
Foundation Backgrounder No. 3378, January 30, 2019, https://www.heritage.org/sites/default/files/2019-01/

BG3378.pdf; Andrew N. Vollmer, “Testimony on Workforce Management D
submitted to the Subcommittee on Investor Protection, Entrepreneurship,
on Financial Services, U.S. House of Representatives, December 6, 2022, h

meeting/house/115227/witnesses/HHRG-I17-BA16-Wstate-VollmerA-2022
2023); David R. Burton, “Reforming
https:/Awww.heritage.o

Paper, January 2015, h
uthor

e
files/2017-02/1l_ProsperityUnleashed_Chapterl.pdf.

isclosures and Other SEC Issues,”
and Capital Markets, Committee
tos://www.congress.gow/117/
208.pdf (accessed February 20,

NRA,” Heritage Foundation Backgrounder No. 3181, February 1, 2017,
g/sites/default/files/2017-02/BG3181.pdf; Hester Peirce, “The Financial Industry

Regulatory Authority: Not Self-Regulation After All,” Mercatus Center at George Mason University Working
ps://www.mercatus.org/research/working-papers/financial-industry-regulatory-

a y-not-self-regulation-after-all (accessed February 20, 2023); Thaya Brook Knight, “Transparency and
Accountability at the SEC and at FINRA,” Chapter 11 in Prosperity Unleashed: Smarter Financial Regulation,
d. Norbert J. Michel, (Washington: The Heritage Foundation, 2017) https://www.heritage.org/sites/default/

Reorganization Plan No. 10 of 1950, U.S. Code Title 5—Appendix, Reorganization Plans, http://uscode.house.
gov/view.xhtml?req=granuleid:USC-prelim-titlesa-node84-leafll4&num=O&edition=prelim (accessed

February 20, 2023).
The board or commission should evaluate the regulatory functions of the

ational Securities Exchanges,

Registered Securities Future Product Exchanges, Registered Clearing Agencies (such as the Depository Trust

Company (DTC), the National Securities Clearing Corporation (NSCC) and

he Options Clearing Corporation

(OCC)), the Municipal Securities Rulemaking Board (MSRB) and the National Futures Association (NFA). This

board or commission should have a broad composition and permit minori
Boyden Gray & Associates, Comments Submitted on Behalf of Alliance for
the Nasdaq Stock Market LLC; Notice of Filing of Proposed Rule Change to
to Board Diversity, Amendment No. 1, File No. SR-NASDAQ-2020-081, Apri

y reports.

Fair Board Recruitment Concerning
Adopt Listing Rules Related

| 6, 2021 https://www.sec.gov/

comments/sr-nasdaq-2020-081/srnasdaq2020081-8639478-230941.pdf (accessed February 20, 2023);

David R. Burton, “Nasdaq’s Proposed Board-Diversity Rule Is Immoral and

Has No Basis in Economics,”

Heritage Foundation Backgrounder No. 3591, March 9, 2021, https://www.heritage.org/sites/default/
files/2021-03/BG3591_0.pdf. The SEC is contemplating at least two rules that can be expected to require
differential treatment based on race, sex, ethnicity, and so on. See Executive Office of the President, Office

— 840 —

10.

11.

12.

13.

14.

15.

16.

17.

18.

“Im

2025 Presidential Transition Project

of Management and Budget, Office of Information and Regulatory Affairs, “Fall 2022 Unified Agenda of
Regulatory and Deregulatory Actions: Active Regulatory Actions Listed by Agency,” https://www.reginfo.gov/

public/do/eAgendaMain (accessed February 20, 2023); “Human

AM88, https://www.reginfo.gov/pub

February 20, 2023); “Corporate Board Diversity,” RIN: 3235-AL91,
N=3235-AL91 (accessed February 20, 2023).
/15/772-3 (accessed February 20, 2023); 15 U.S.
accessed February 20, 2023).

7th Congress, 2nd Session, h
Odiscussiondraft.pdf (accessed February 20,

eAgendaViewRule?publd=202204&
15 US. Code § 772-3, h
Code § 78mm, https://www.law.corne
S.___, Jumpstart Our Business Startu
www.banking.senate.gov/im
2023); David R. Burton, “Entrepreneur
Housing, and Urban Affairs, U.S. Sena
capital-formation; “Removing Barriers
Opportunities,” Section 6 in Nicho
Solowey, “Sound Financial Policy:
and Ann Ru
inancial-po

Prin

icy-Il8th-congress.pd
and Urban Affairs, U.S. Senate, March
Burton%20and%20Norbert%20M
proving Entrepreneurs’ Access
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0.3

The crowdfunding exemption
Business Startups Act, Public Law No.
govinfo.gov/content/pkg/PLAW-112pu
Burton, “Improving Entrepren
Jr, “The Case for Federal Pre-

Emption

Financial Regulation, https://www.heri

Chapter06.pdf.
Andrew N. Vo
Regulation Law Journal, Vol. 49, No. 5 ¢
id=3719280 (accessed
on Private Securities O
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ferings Harm In

evidence-use-disclosu
For a detailed discussion, see “Micro-O

tps://www.law.

as Anthon

The small issues exemptive authority has been in
was created

eurs’ Access

February 20, 2023);

age.org/sites/de

cornel
|.edu/uscode/tex
ps Act

o/media/doc/the_jobs_act_.
ial Capital Formation,”
e, April 5, 2022, httos://www.he
all Business Capi
y, Norbert J.

to Sm

.edu/uscode/

of 2022, discuss

ex
/15/78rn
ion

m
draft,
4

es before the Committe

imony
r

tal Forma

ichel, Jennifer J. Schulp, George S

cipled Recommen

on, Cato Institute, 2022, pp. 22-27, https://www.cato.org/si
(accessed February 20, 2023); Davi
Proposals to Foster Economic Growth and Capital Formation, Submiss
tos://www.banking.senate.gov/imo/media/doc/Dav
ichel%20-%202021-3-
0 Capita
tos://www.heritage.org/si

18, 2021, h
: Vita

the Se
by Title Ill of
112-106, 112
bI106/pdf/PLAW-
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ferings,” Section

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startups-sell-stock (accessed February

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Backgrounder No. 3328, Ju

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20, 2023).

for Economic Growth,”

h Congress, April 5, 2021, Title Ill, § 302, ht
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22, 2020, https://www.merca
e-securities-of

y 10, 2018, https://Awww.heri
. Vollmer, “Make It Easy for Startups to Sell Stock,” Mercatus Center at
nercatus.org/bridge/commentary/make-it-easy-

dations for the

dR. Burto
ion to Com

mittee on B

8.pdf (accessed February 20, 2023);

he 2012 JOBS Act. See H.R. 3606, Ju

for Economic Growth”; Rutheford

age.org/testimony/en
ion and Expanding Investor

8th Congress,” ed. Norbert J.
es/cato.org/files/2022-10/sou
n and Norber

Capital Management Disclosure,” RIN: 3235-
ic/do/eAgendaViewRule?publd=202204&RIN=3235-AM88 (accessed
tps://www.reginfo.gov/public/do/

tps://

e on Ban
repren

king,
eurial-

d Jack
Michel
nd-

J. Michel,
nking, Housing,
id%20
David R. Burton,

elgin, an

Heritage Foundation Backgrounder
es/default/files/2017-02/BG3182. pdf.
curities Act since its initial enactment.

mpstart Our
ps://www.

B. Campbell
shed: Smarter

a
Laws,” Chapter 6 in Prosperity Unlea
ault/files/2017-02/06_ProsperityUn

night, “Your
ute Policy Anal

SiS No. 833, February

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ed

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”

erings-O
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eashed_

nvestors in Private Securities Offerings,” Securities
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oney’s No Good Here: How Restrictions

9, 2018, https://

0.0rg/files/pubs/pdf/pa833.odf (accessed February 20, 2023); David R. Burton, “Congress
rities Offerings,” Heritage Foundation /ssue Brief No. 4899, August 29,

It/files/2018-08/1B4899. pdf;
Use of Disclosure Documents in Private Securities Offerings to Accredi
ason University Working Paper, October
e-documents-priva

idence on the

Investors,” Mercatus Center at George
us.org/publications/financial-regulation/

3).

and Michel, Proposals to Foster

se Capital Using Finders and Private Placement Brokers,” Heritage
age.org/sites/default/files/2018-07/

George Mason

, S-Corp Access to Crowdfunding Act, 115th Congress, introduced January 13, 2017, https://www.

govinfo.gov/content/pkg/BILLS-115hr53lin/pdf/BILLS-T15hr53lih.pdf (accessed February 20, 2023); David
Burton, “The Tax Law Makes It Almost Impossible for ‘S Corporations’ to Use Equity Crowdfunding,” The Daily

Signal, Apri

s-corporations-to-use-equity-crowdfunding/.

— 841

19, 2016, https://www.dailysignal.com/2016/04/19/the-tax-law-makes-it-almost-impossible-for-

19.

20.

21.

22.

23.

24.

25.
26.
Zh
28.
29.

30.

31.

32.

55:

34,

55:

36.

Mandate for Leadership: The Conservative Promise

Cato Summit on Financial Regulation.”

Commission.”

Burton, “Improving Entrepreneurs’ Access to Capital: Vital for Economic Growth”; Campbell, “The Case for
Federal Pre-Emption of State Blue Sky Laws.”
David R. Burton, “Why the SEC’s Consolidated Audit Trail Is a Bad Idea,” Heritage Foundation Commentary,
December 5, 2019, https://www.heritage.org/monetary-policy/commentary/why-the-secs-consolidated-
audit-trail-bad-idea; Hester M. Peirce, Commissioner, U.S. Securities and Exchange Commission, “Statement
on the Order Granting Temporary Conditional Exemptive Relief from Certain Requirements of the National
arket System Plan Governing the Consolidated Audit Trail,” July 8, 2022, https:/Awww.sec.gov/news/
statement/peirce-statement-consolidated-audit-trail-070822 (accessed February 20, 2023).
Peirce, “It’s Not Just Scope 3: Remarks at the American Enterprise Institute”: Uyeda, “Remarks at the 2022

David R. Burton, “How Dodd-Frank Mandated Disclosures Harm, Rather than Protect, Investors,” Heritage
Foundation Issue Brief No. 4526, March 10, 2016, http://thf-reports.s3.amazonaws.com/2016/1B4526. pdf.
For a detailed discussion of SEC administration, see Burton, “Reforming the Securities and Exchange

See, for example, Andrew N. Vollmer, “Accusers as Adjudicators in Agency Enforcement Proceedings,”
University of Michigan Journal of Law Reform, Vol. 52, No. 1 (Fall 2018), pp. 103-155, https://repository.law.
umich.edu/cgi/viewcontent.cgi?article=1602&context=mijlr (accessed February 20, 2023).

7US.C. § 1a(9), https://www.law.cornell.edu/uscode/text/7/la (accessed February 20, 2023).

Or the CFTC can undertake a rulemaking.

7US.C. § 2(), httos://www.law.cornell.edu/uscode/text/7/2 (accessed February 20, 2023).

7US.C. § 7b-3, https://www.law.cornell.edu/uscode/text/7/7b-3 (accessed February 20, 2923).

Commodity Futures Trading Commission, “Cross-Border Application of the Registration Thresholds and
Certain Requirements Applicable to Swap Dealers and Major Swap Participants,” Final Rule, Federa/ Register,
Vol. 85, No. 178 (September 14, 2020), pp. 56924-57016, https://www.govinfo.gov/content/pkg/FR-2020-09-

14/pdf/2020-16489.pdf (accessed February 21, 2023).

Commodity Futures Trading Commission, “Interpretive Guidance and Policy Statement Regarding Compliance

h Certain Swap Regulations,” Federa/ Register, Vol. 78, No. 144 (July 26, 2013), pp. 45292-45374, https://

www.cftc.gov/sites/default/files/idc/groups/public/@lrfederalregister/documents/file/2013-17958a.pdf

(accessed February 21, 2023).

Commodity Futures Trading Commission, “Margin Requirements for Uncleared Swaps for Swap Dealers and

us/ (accessed March 23, 2023).

ajor Swap Participants—Cross-Border Application of the Margin Requirements,” Final Rule, Federa/ Register,
Vol. 81, No. 104 (May 31, 2016), pp. 34818-34854, https://www.govinfo.gov/content/pkg/FR-2016-05-31/
odf/2016-12612.pdf (accessed February 21, 2023).
H.R. 4173, Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, 1llth Congress,
July 21, 2010, Title X, https:/Avww.congress.gov/1I1/plaws/publ203/PLAW-Illpub|203.pdf (accessed March 23,
2023). See also Consumer Financial Protection Bureau, “About Us,” https://www.consumerfinance.gov/about-

See, for example, Paul Sperry, “Trump Is Finally Fixing This Economy-Killing Agency,’ New York Post,
December 2, 2017, https://nypost.com/2017/12/02/trump-is-finally-fixing-this-economy-killing-agency/
(accessed March 23, 2023). See also Jeb Hensarling “How We'll Stop a Rogue Federal Agency,” 7he

fall Street Journal, February 8, 2017, https://www.wsj.com/articles/how-well-stop-a-rogue-federal-

agency-1486597413 (accessed March 23, 2023), and H.R. 3389, CFPB Slush Fund Elimination Act of 2013, 113th
Congress, introduced October 30, 2013, https://www.congress.gov/113/bills/hr3389/BILLS-113hr3389ih. pdf

(accessed March 23, 2023).

Editorial, “CFPB Joins Justice in Shaking Down Banks for Democrat Activist Groups,” /nvestor’s Business Daily,
June 17, 2015, https://www.investors.com/politics/editorials/cfpb-diverts-civil-penalty-funds-to-democrat-

activist-groups/ (accessed March 23, 2023).

Table, “Budget by Program,” in Consumer Financial Protection Bureau, Annual Performance Plan and
Report, and Budget Overview, February 2023, p. 15, https://files.consumerfinance.gov/f/documents/cfpb_
performance-plan-and-report_fy23.pdf (accessed March 23, 2023).

Table, “FTE by Program,” in ibid., p. 16.

— 842 —

37.

38.
39.

40.

Al.

42.

43.

44.

AS.

46.
47.

48.

49.
50.
51,

52:

54.

Dos
56.

2025 Presidential Transition Project

Table 7, “Civil Penalty Fund Significan
of the Consumer Financial Protection Bureau, Fiscal Year 2022, November 15
consumerfinance.gov/f/documents/c
Ibid.
Consumer Financial P
Year 2022, p. 20.
12 U.S. Code § 5491, h
Consumer Financial P

otection

Activity,” in Consumer Financial Protection Bureau, Financial Report

, 2022, p. 21, https://files.

pb_financial-report_fy2022.pdf (accessed March 23, 2023).
Bureau, Financial Report of the Consumer Financial Protection Bureau, Fiscal

tos://www.law.cornell.edu/uscode/text/12/5491 (accessed March 23, 2023).
Bureau, “Bureau Structure,” last updated March 15, 2023, https://Awww.

consumerfinance.gov/about-us/the-bureau/bureau-structure/ (accessed March 23, 2023).

See Consumer Financial Protec

ion Bureau, “Consumer Financial Civil Penalty Fund Rule,” https://www.

consumerfinance.gov/rules-policy/final-rules/consumer-financial-civil-penalty-fund-rule/ (accessed

March 23, 2023).

Consumer Financial P

otection

education-financial-literacy/ (accessed March 23, 2023).
U.S. Government Accountability Office, Consumer Financial Protection Burea

Bureau, “Civil Penalty Fund: Consumer Education and Financial Literacy,”
https:/Awww.consumerfinance.gov/enforcement/payments-harmed-consumers/civil-penalty-fund/consumer-

u: Opportunity Exists to Improve

Transparency of Civil Penalty Fund Activities, GAO-14-551, June 2014, https://www.gao.gov/assets/gao-14-551.

pdf (accessed March 23, 2023).

Seila Law LLC v. Consumer Financial Protection Bureau, 591U.S.____ (2020),
opinions/19pdf/19-7_n6io.pdf (accessed March 23, 2023).

Ibid., p. 37.

https://Awww.supremecourt.gov/

See 12 U.S. Code § 5497(a)(1), https://www.law.cornell.edu/uscode/text/12/5497 (accessed March 23, 2023).
Congress specified that the amount transferred to the CFPB “shall not exceed” 12 percent “of the total
operating expenses of the Federal Reserve System...in fiscal year 2013, and in each year thereafter.” Ibid., §

5497(2)(A)(iii).

Community Financial Services Association of America v. Consumer Financial Protection Bureau (5th Cir. 2022),

pp. 31-32, h
bid., p. 32.
bid. (quoting Sella Law LLC v. CFPB, 140 S. Ct. 2183, 2202 n. 8 (2020)).

arch 23, 2023).
Devin Watkins, Competitive Enterprise Institute, “Consumer Financial Protec
estimony before the Subcommittee on Financial Institutions and Monetary

BA20/20230309/115384/HHRG-
orbert J. Michel, “7 Steps Nex
Awful,” Heri
commentary/7-steps-next-director-can-take-make-the-consumer-financial.

Director Can Take to Make the Consumer Fin

Po
Financial Services, U.S. House of Representatives, March 9, 2023, https://docs.house.gov/meetings/BA/
18-BA20-Wstate-WatkinsD-20230309.pdf (accessed March 23, 2023);

age Foundation Commentary, July 28, 2018, https://www.heritage.org/marke

tos://www.ca5.uscourts.gov/opinions/pub/21/21-50826-CV0.pdf (accessed March 23, 2023).

U.S. Supreme Court, “Order List: 598 U.S.,” February 27, 2023, Docket No. 22-448, CFPB et al. v. Com. Fin.
Services Assn., et al., httos://(www.supremecourt.gov/orders/courtorders/022723zor_6537.pdf

accessed

ion Bureau: Ripe for Reform,”
icy, Committee on

ion Bureau Less
s-and-finance/

ancial Protec

The Office of the Comptroller of the Currency (OCC), Federal Deposit Insuran
and Nationa

ce Corporation, Federal Reserve,

Credit Union Administration. Those functions performed by the Office of Thrift Supervision (OTS)

prior to Dodd-Frank should be transferred to the OCC since OTS has merged with OCC.

See “Section 1071 of the Dodd-Frank Act” in David R. Burton, “Improving Sm
Consumer Financial Protection Bureau Symposium on Section 1071 of the Do

all Business Access to Capital,”
dd-Frank Act, Small Business

Lending Panel, November 6, 2019, https://files.consumerfinance.gov/f/docun
statement_symposium-section-1071.pdf (accessed March 23, 2023).

nents/cfob_burton-written-

5 U.S. Code Chapter 5, https://www.law.cornell.edu/uscode/text/5/part-I/chapter-5 (accessed March 23, 2023).
Consumer Financial Protection Bureau, “Administrative Adjudication Proceedings,” https://www.
consumerfinance.gov/administrative-adjudication-proceedings/ (accessed March 23, 2023), and 12 Code of

Federal Reg
cfr/text/12/part-1081 (accessed

arch 23, 2023).

— 843 —

lations Part 1081—Rules of Practice for Adjudication Proceedings, https://www.law.cornell.edu/

FEDERAL
COMMUNICATIONS
COMMISSION

Brendan Carr

MISSION STATEMENT

The FCC should promote freedom of speech, unleash economic opportunity,
ensure that every American has a fair shot at next-generation connectivity, and
enable the private sector to create good-paying jobs through pro-growth reforms
that support a diversity of viewpoints, ensure secure and competitive communi-
cations networks, modernize outdated infrastructure rules, and represent good
stewardship of taxpayer dollars.

OVERVIEW AND BACKGROUND

The FCC is an independent regulatory agency that has jurisdiction over inter-
state and international communications by radio, television, wire, satellite, and
cable.’ Five Commissioners are appointed by the President and confirmed by the
Senate for fixed five-year terms.? The FCC does not have any other presidentially
appointed, Senate-confirmed officials. Ordinarily, the five-member FCC is divided
politically three to two with a majority of Commissioners from the same political
party as the President. The Commissioners’ terms are staggered so that every year
at the end of June, one Commissioner’s term expires.* However, a Commissioner
can continue to serve until the end of the next session of Congress (or up to 1.5
years beyond the expiration of the term) if no replacement is confirmed after his
or her term ends.*

By law, only a bare majority of Commissioners can be from the same politi-
cal party (no more than three when there are five members).° By tradition, the
Chairperson resigns when a new President of a different political party is sworn

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Mandate for Leadership: The Conservative Promise

into office—though this is not required by law. By resigning, the exiting Commis-
sioner enables the President to nominate someone from his own political party
to the FCC, and this typically shifts the political balance on the FCC toward the
President’s political party. The President generally designates one of the existing
Commissioners of the President’s same political party as Chairperson—either on
an acting or a permanent basis—on or shortly after Inauguration Day.

Under a tradition that dates back a few decades, when a relevant vacancy arises,
the President allows the leader of the opposite political party in the Senate to select
the person who will serve in the minority Commissioner role. The President then
formally nominates the person identified by Senate leadership. This also is not
required by law.

As specified in the Communications Act of 1934, the FCC’s Chairperson serves
as the agency’s CEO and is empowered with significant authority that is not shared
with other Commissioners.° For instance, the Chairperson sets the FCC’s agenda,
decides what matters the agency will vote on and when, and has authority to orga-
nize and coordinate the FCC’s work.’ There is no separate Senate confirmation
process for the position of FCC Chairperson; the President designates one of the
Commissioners to serve as Chairperson through a short one-sentence or two-sen-
tence letter.® There are no limits on the number of terms that a person can serve
as an FCC Commissioner, though Commissioners need to be nominated and con-
firmed for each five-year term.

FCC Budget and Structure. In recent years, the FCC has employed between
1,300 and 1,500 people.’ The FCC’s fiscal year 2023 budget request is for approx-
imately $390.2 million.!° While Congress appropriates funds for the FCC, the
agency’s budget is offset by what are known as regulatory fees—fees the FCC col-
lects from the licensees and other entities that it regulates and uses to offset its
budget request. The FCC also raises revenue for the government by auctioning
spectrum licenses. In fact, the FCC has generated more than $200 billion for the
U.S. Treasury through spectrum auctions."

The FCC is organized into a series of bureaus and offices based on function.
These include an Office of General Counsel, Office of Inspector General, Office of
Legislative Affairs, Media Bureau, Wireless Telecommunications Bureau, Wireline
Competition Bureau, Enforcement Bureau, and more.”

High-Profile FCC Matters. The FCC addresses a number of important mat-
ters. For instance, Section 230 is codified in the Communications Act,’ and the
FCC has authority to interpret that law and thus provide courts with guidance
about the proper application of the statutory language.* The FCC has addressed

“net neutrality” rules and the regulatory framework that should apply to broadband
offerings. Any merger that involves a wireless company, broadcaster, or similar
entity that holds an FCC license must obtain FCC approval (assuming that the
merger will involve the transfer of the FCC license).

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2025 Presidential Transition Project

The FCC has facilitated the transition from 3G to 4G and now 5G offerings in
two ways. First, it has freed spectrum—the airwaves needed to deliver wireless ser-
vices. Second, it has preempted state and local siting and permitting laws that could
otherwise slow down the buildout of next-generation infrastructure. One of the
FCC’s great success stories from 2017 to 2020 was securing U.S. leadership in 5G.

The FCC also administers an approximately roughly $9 billion-a-year program
called the Universal Service Fund (USF), which has been funded by a line-item
charge that traditional telephone companies add to consumers’ monthly bills.
Expenditures from this fund subsidize rural broadband networks and low-income
programs as well as connections for schools, libraries, and rural health care facil-
ities. Through various COVID-era laws, Congress has also provided the FCC with
a one-time $24 billion appropriation for various low-income initiatives.

POLICY PRIORITIES
The FCC needs to change course and bring new urgency to achieving
four main goals:

e Reining in Big Tech,

e Promoting national security,

e Unleashing economic prosperity, and

e Ensuring FCC accountability and good governance.”

Reining in Big Tech. The FCC has an important role to play in addressing
the threats to individual liberty posed by corporations that are abusing dominant
positions in the market. Nowhere is that clearer than when it comes to Big Tech
and its attempts to drive diverse political viewpoints from the digital town square.

Today, a handful of corporations can shape everything from the information
we consume to the places we shop. These corporate behemoths are not merely
exercising market power; they are abusing dominant positions. They are not simply
prevailing in the free market; they are taking advantage of a landscape that has
been skewed—in many cases by the government—to favor their business models
over those of their competitors. It is hard to imagine another industry in which a
greater gap exists between power and accountability. That is why a new Adminis-
tration should support FCC action on several fronts. Specifically, the FFC should:

e Eliminate immunities that courts added to Section 230. The FCC

should issue an order that interprets Section 230 in a way that eliminates
the expansive, non-textual immunities that courts have read into the statute.

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Mandate for Leadership: The Conservative Promise

As one of the FCC’s previous General Counsels noted, the FCC has authority
to take this action because Section 230 is codified in the Communications
Act.'© The FCC’s Section 230 reforms should track the positions outlined

in a July 2020 Petition for Rulemaking filed at the FCC near the end of

the Trump Administration.” Any new presidential Administration should
consider filing a similar or new petition.

As Justice Clarence Thomas has made clear, courts have construed Section
230 broadly to confer on some of the world’s largest companies a sweeping
immunity that is found nowhere in the text of the statute.!* They have done
so ina way that nullifies the limits Congress placed on the types of actions
that Internet companies can take while continuing to benefit from Section
230. One way to start correcting this error is for the FCC to remind courts
how the various portions of Section 230 operate.

At the outset, the FCC can clarify that Section 230(c)(1) does not apply
broadly to every decision that a platform makes. Rather, its protections
apply only when a platform does not remove information provided by
someone else. In contrast, the FCC should clarify that the more limited
Section 230(c)(2) protections apply to any covered platform’s decision
to restrict access to material provided by someone else. Combined, these
actions will appropriately limit the number of cases in which a platform
can censor with the benefit of Section 230’s protections. Such clarifications
might also include drawing out the traditional legal distinction between
distributor and publisher liability; Section 230 did not do away with the
former, nor does it collapse into the latter.

Impose transparency rules on Big Tech. Today, Big Tech offers a black
box. After Google manipulates search results, a small business can see its
web traffic drop precipitously overnight for no apparent reason, potentially
flipping its outlook from black to red. On Facebook, social media posts

are left up or taken down, accounts suspended or permanently banned,
without any apparent consistency. Out of the blue, YouTube can demonetize
individuals who have risked their capital and invested their labor to build
online businesses.

At present, the FCC requires broadband providers to comply witha
transparency rule that can provide a good baseline for Big Tech. Under the
FCC’s rule, broadband providers must provide detailed disclosures about
practices that would shape Internet traffic—from blocking to prioritizing or
discriminating against content. The FCC could take a similar approach to

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2025 Presidential Transition Project

Big Tech, and it should look to Section 230 and the Consolidated Reporting
Act as potential sources of authority.” In acting, the FCC could require these
platforms to provide greater specificity regarding their terms of service, and it
could hold them accountable by prohibiting actions that are inconsistent with
those plain and particular terms. Within this framework, Big Tech should be
required to offer a transparent appeals process that allows for the challenging
of pretextual takedowns or other actions that violate clear rules of the road.

Support legislation that scraps Section 230’s current approach. The
FCC should work with Congress on more fundamental Section 230 reforms
that go beyond interpreting its current terms. Congress should do so by
ensuring that Internet companies no longer have carte blanche to censor
protected speech while maintaining their Section 230 protections. As

part of those reforms, the FCC should work with Congress to ensure that
antidiscrimination provisions are applied to Big Tech—including “back-end”
companies that provide hosting services and DDoS protection. Reforms
that prohibit discrimination against core political viewpoints are one way to
do this and would track the approach taken in a social media law passed in
Texas, which was upheld on appeal in late 2022 by the U.S. Court of Appeals
for the Fifth Circuit.”°

In all of this, Congress can make certain points clear. It could focus
legislation on dominant, general-use platforms rather than specialized
ones. This could include excluding comment sections in online publications,
specialized message boards, or communities within larger platforms that
self-moderate. Similarly, Congress could legislate in a way that does not
require any platform to host illegal content; child pornography; terrorist
speech; and indecent, profane, or similar categories of speech that Congress
has previously carved out.

Support efforts to empower consumers. The FCC and Congress should
work together to formulate rules that empower consumers. Section 230
itself codifies “user control” as an express policy goal and encourages
Internet platforms to provide tools that will “empower” users to engage

in their own content moderation. As Congress takes up reforms, it should
therefore be mindful of how we can return to Internet users the power to
control their online experiences. One idea is to empower consumers to
choose their own content filters and fact checkers, if any. The FCC should
also work with Congress to ensure stronger protections against young
children accessing social media sites despite age restrictions that generally
prohibit their use of these sites.

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Mandate for Leadership: The Conservative Promise

It should be noted at this point that the views expressed here are not shared
uniformly by all conservatives. There are some, including contributors to
this chapter, who do not think that the FCC or Congress should act in a way
that regulates the content-moderation decisions of private platforms. One
of the main arguments that this group offers is that doing so would intrude—
unlawfully in their view—on the First Amendment rights of corporations to
exclude content from their private platforms.

e Require that Big Tech begin to contribute a fair share. Big Tech
has avoided accountability in several additional ways as well. One of
them concerns the FCC’s roughly $9 billion Universal Service Fund.
This initiative provides the support necessary to subsidize the agency’s
affordable Internet and rural connectivity programs. The FCC obtains this
funding through a line-item charge that carriers add to consumers’ monthly
bills for traditional telecommunications service.

While Big Tech derives tremendous value from the federal government’s
universal service investments—using those federally supported networks
to deliver their products and realize significant profits—these large
corporations have avoided paying a fair share into the program. On top of
that, the FCC’s current funding mechanism has been on an unsustainable
path.” By requiring traditional telephone customers to contribute to a
fund that is being used increasingly to support broadband networks, the
FCC’s current approach is the regulatory equivalent of taxing horseshoes
to pay for highways. To put the FCC’s universal service program on a stable
footing, Congress should require Big Tech companies to start contributing
an appropriate amount.

Conservatives are not unanimous in agreeing that the FCC should expand
the USF contribution base. Instead, some argue that Congress should revisit
the program’s entire funding structure and determine whether to continue
subsidizing the provision of service. Future funding decisions, the argument
goes, should be made by Congress through the normal appropriation process
through which the USF program can compete for funding with other national
initiatives. These decisions should be made with an eye to right-sizing

the federal government’s existing broadband initiatives in light of both
technological advances and the recent influx of billions of dollars in new
appropriations that can be used to support efforts to end the digital divide.

Protecting America’s National Security. During the Trump Administra-
tion, the FCC ushered in a new and appropriately strong approach to the national

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2025 Presidential Transition Project

security threats posed by the Chinese Communist Party (CCP). During that time,
the FCC eliminated federal subsidies for telecommunications equipment from
Huawei and ZTE, thereby greatly reducing the chances of that equipment finding a
way into our nation’s communications networks. The FCC also stood up a program
to rip and replace insecure network gear to ensure that it did not remain a threat
lurking inside our systems. The FCC revoked or denied the licenses of carriers like
China Mobile, China Telecom, and China Unicom, which presented unacceptable
national security risks. There are, however, additional strong actions that the FCC
can and should take to address the CCP’s malign campaign. Specifically:

e Address TikTok’s threat to U.S. national security. As law enforcement
officials have made clear, TikTok poses a serious and unacceptable risk to
America’s national security.” It also provides Beijing with an opportunity to
run a foreign influence campaign by determining the news and information
that the app feeds to millions of Americans. As of this writing, the Biden
Administration’s Treasury Department has not announced a final decision
concerning its long-pending review of TikTok. If that inaction persists, or if
the Administration allows TikTok to continue to operate in the U.S., anew
Administration should ban the application on national security grounds.

e Expand the FCC’s Covered List. The FCC maintains a list of
communications equipment and services that pose an unacceptable risk to
the national security of the United States. It is known as the Covered List.”*
Huawei is one of the companies on the Covered List, and its inclusion means
that the FCC will no longer review or approve new applications from Huawei.
Without FCC approval, new Huawei gear cannot be lawfully sold or used in
the U.S. However, the FCC must do a better job of ensuring that its Covered
List stays up to date and accounts for changes in corporate names and forms.
Therefore, a new Administration should create a more regular and timely
process for reviewing entities with ties to the CCP’s surveillance state.

e End the unregulated end run. As noted above, China Telecom and similar
entities have been banned from operating in the U.S. in a manner that would
require an FCC license or authorization because of the national security
risks that those entities pose. However, many of these same entities are
still operating in the U.S. and offering services very similar to the ones that
they are prohibited from providing. China Telecom, for instance, continues
to provide services to data centers by offering the services on a private or

“unregulated” basis. Anew Administration should work with the FCC to
close this loophole. One way to do so would be for the FCC to prohibit any
regulated carrier from interconnecting with an insecure provider.

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Mandate for Leadership: The Conservative Promise

Publish a foreign adversary transparency list. As part of the FCC’s
ongoing work to secure our networks from entities that would do the
bidding of our foreign adversaries, the FCC should do more to shine the
light of transparency on the scope of the problem. To this end, the FCC
should compile and publish a list of all entities that hold FCC authorizations,
licenses, or other grants of authority with more than 10 percent ownership
by foreign adversarial governments, including the governments of China,
Russia, Iran, Syria, or North Korea. A bipartisan bill that would require

the FCC to publish this type of list has been introduced in the House of
Representatives by Representatives Elise Stefanik (R-NY), Ro Khanna (D-
CA), and Mike Gallagher (R-WI).**

Fully fund the federal “rip and replace” program. In 2019, Congress
established a $1.9 billion Secure and Trusted Communications Networks
Reimbursement Program (known colloquially as the “rip and replace”
program) to reimburse communications providers for the reasonable
expenses they would incur to remove, replace, and dispose of insecure
Huawei and ZTE gear. However, $1.9 billion is about $3 billion short of the
total amount of funding needed to complete the rip and replace process. A
new Administration should ensure that the program is fully funded and
should look first at repurposing and applying unused COVID-era emergency
funds for this purpose.

Launch a Clean Standards Initiative. During the Trump Administration,
the U.S. government launched a worldwide Clean Networks program.”

As aresult of this initiative, many of the U.S. government’s allies started

the process of ending their relationships with Huawei. It is time for an
Administration to build and expand on this groundbreaking work by

taking a similar approach to the standard-setting process. Right now,

the CCP is seeking to extend its influence by exerting control over the
development of standards in a variety of areas, including technology and
telecommunications. It is vital that the United States meet this threat with a
comprehensive clean standards initiative.

Stop aiding the CCP’s authoritarian approach to artificial
intelligence. The CCP has set itself a goal of becoming the global leader in
artificial intelligence (AI) by 2030. Beijing is bent on using this technology
to exert authoritarian control domestically and export its authoritarian
governance model overseas. U.S. businesses are aiding Beijing in this effort—
often unwittingly—by feeding, training, and improving the AI datasets

of companies that are beholden to the CCP. One way that U.S. companies

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2025 Presidential Transition Project

are doing this is by giving Beijing access to their high-powered cloud
computing services. Therefore, it is time for an Administration to put in
place a comprehensive plan that aims to stop U.S. entities from directly or
indirectly contributing to China’s malign AI goals.

Unleashing Economic Prosperity. The FCC needs to advance a pro-growth
agenda that gives every American a fair shot at next-generation connectivity.
This is vital for economic opportunity and prosperous communities. The current
Administration has appropriated a lot of money for broadband infrastructure proj-
ects, but it has failed to pair that spending with reforms that free more airwaves
for wireless connectivity or streamline the permitting processes for broadband
builds. That failure is holding back America’s hardworking telecommunications
crews and leaving Americans stuck waiting on the wrong side of the digital divide.
It is time for areturn to the successful spectrum and infrastructure policies that
prevailed during the Trump Administration—policies that enabled the U.S. to lead
the world in 5G.

e =Refill America’s spectrum pipeline. From 2017 through 2020, the FCC
took unprecedented steps to free the airwaves needed to power 5G and
other next-generation wireless services. This work not only helped to secure
America’s wireless leadership and bolster competition, but also enabled the
private sector to create jobs and grow the economy. Recently, the FCC has
failed to match the pace and cadence of those spectrum actions. Therefore,
the FCC and a new Administration should work together to develop a
national spectrum strategy that both identifies the specific airwaves that
the FCC can free for commercial wireless services and sets an aggressive
timeline for agency action.

e 6Facilitate coordination on spectrum issues. Wireless services now
play acentral role in advancing America’s economic and national security
interests. Over the past few years, this dynamic has led to an increasing
number of headline-level disputes between the commercial wireless sector
and federal agencies. These disputes are often framed in zero-sum terms
as commercial wireless and federal agency stakeholders argue over the
appropriate types and amount of airwaves that the government should
allocate for various purposes. On the one hand, America’s global economic
leadership depends on its ability to free spectrum that will power the US.
commercial wireless industry. On the other hand, we must ensure that
America’s national security and other federal agencies have access to the
spectrum resources that they need to carry out their vital missions.

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Mandate for Leadership: The Conservative Promise

It is clear that the current process is not delivering optimal outcomes. In
December 2021 and January 2022, for instance, the lack of interagency
coordination and communication about mid-band 5G spectrum allocation
between the FCC and the Federal Aviation Authority led to significant
challenges for the U.S. aviation industry. Over the past two years, the FCC
has failed to move spectrum into the commercial marketplace at the same
pace and cadence that it did in the recent past. Creating better mechanisms
to improve communication and cooperation between different federal
agencies could enable a more effective and coordinated U.S. government
telecommunications strategy. The White House should work with Congress
to establish a spectrum coordination process that will work for both
commercial and federal users.

Modernize infrastructure rules. By 2016, the construction of new cell
sites—the building blocks for 5G—had essentially flatlined in America.
Because of outdated permitting rules, it cost too much and took too long to
build wireless infrastructure, so the FCC went to work. The agency updated
the environmental and historic preservation rules that needlessly drove up
the cost and slowed down the timeline for adding small cells. The FCC put in
place guardrails to address outlier fees and delays imposed at the state and
local levels on those same small-cell projects. It modernized the permitting
process in several additional ways as well.

Those FCC reforms delivered results. They allowed America’s private
sector to bring thousands of families across the digital divide and to keep
Americans connected during the pandemic. In fact, infrastructure builds
accelerated at a record pace after those reforms. In 2019, for instance, U.S.
providers built over 46,000 new cell sites—a sixty-fivefold increase over
2016 levels.

The FCC has not engaged in any similar infrastructure reforms in recent
years, and there is much more that needs to be done. For instance, the FCC’s
prior reforms focused on streamlining the rules for small wireless facilities.
The FCC should now explore similar action for the deployment of other
wired infrastructure by imposing limits on the fees that local and state
governments can charge for reviewing those wireline applications and time
restrictions on the government’s decision-making process.

The next Administration should also work to address the delays that

continue to persist when it comes to building Internet infrastructure on
federal lands. This is an area where the FCC itself has very little jurisdiction,

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2025 Presidential Transition Project

so anew Administration should redouble efforts to require timely reviews
and final actions by agencies with jurisdiction over federal lands, including
the Bureau of Land Management and the U.S. Forest Service.

e Advance America’s space leadership. One of the most significant
technological developments of the past few years has been the emergence
of a new generation of low-earth orbit satellites like StarLink and Kuiper.
This technology can beam a reliable, high-speed Internet signal to nearly
any part of the globe at a fraction of the cost of other technologies. This
has the potential to significantly accelerate efforts to end the digital divide
and disrupt the federal regulatory and subsidy regime that applies to
communications networks. The FCC should expedite its work to support
this new technology by acting more quickly in its review and approval of
applications to launch new satellites. Otherwise, the U.S. risks ceding space
leadership to entities based in countries with more friendly regulatory
environments.

Holding Government Accountable. Federal technology and telecommunica-
tions programs have been plagued by a troubling lack of accountability and good
governance. They would benefit from stronger oversight and a fresh look at elim-
inating outdated regulations that are doing more harm than good.

e End wasteful broadband spending policies. Many of the broadband
spending policies being pursued by the current Administration are
poised to waste taxpayer money while leaving rural communities and
unconnected Americans behind. At the same time, the dramatic recent
increases in funding through the American Rescue Plan Act (ARPA) and the
Infrastructure Investment and Jobs Act mean that the federal government
has more than enough resources to meet its broadband connectivity
goals. Congress should therefore hold the agencies accountable so that
taxpayer money is used effectively to promote broadband connectivity
across the nation.

To that end, the next Administration should instruct the various
departments and agencies that are administering broadband infrastructure
funds to direct those resources to communities without adequate

Internet infrastructure instead of to places that already enjoy broadband
connectivity. Take, for example, the final rules that the Treasury
Department adopted in 2022 that govern the expenditure of $350 billion

in ARPA funds. Rather than directing those dollars to the rural and

other communities that have no Internet infrastructure, the current

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Mandate for Leadership: The Conservative Promise

Administration gave the green light for recipients to spend those funds to
overbuild existing high-speed networks in communities that already have
multiple broadband providers. A new Administration should eliminate
government-funded overbuilding of existing networks.

Adopt a national coordinating strategy. Hundreds of billions of
infrastructure dollars have been appropriated by Congress or budgeted by
agencies over the past couple of years that can be used to end the digital
divide. Yet, according to the U.S. Government Accountability Office, “U.S.
broadband efforts are not guided by a national strategy”; instead, “[f]ederal
broadband efforts are fragmented and overlapping, with more than 100
programs administered by 15 agencies,” risking overbuilding as well

as wasteful duplication.”° Many of these programs remain plagued by
inefficiency, further contributing to waste of limited taxpayer dollars.

Moreover, the federal government is failing to put appropriate guardrails

in place to govern the expenditure of billions in broadband funds. This

is the regulatory equivalent of turning the spigot on full blast and then
walking away from the hose. There is a worrisome lack of adequate

tracking, measurement, and accountability standards governing all of this
broadband spending. As a result, we are likely to see headline levels of waste,
fraud, and abuse.

Anew Administration needs to bring fresh oversight to this spending and
put a national strategy in place to ensure that the federal government adopts
a coordinated approach to its various broadband initiatives. Similarly, the
next Administration should ask the FCC to launch a review of its existing
broadband programs, including the different components of the USF, with
the goal of avoiding duplication, improving efficiency of existing programs,
and saving taxpayer money.

Correct the FCC’s regulatory trajectory and encourage competition
to improve connectivity. The FCC is a New Deal-era agency. Its history

of regulation tends to reflect the view that the federal government should
impose heavy-handed regulation rather than relying on competition

and market forces to produce optimal outcomes. President Franklin D.
Roosevelt recommended that Congress create the FCC in February 1934

for the purposes of establishing “a single Government agency charged

with broad authority” over the field of communications.”” Congress
subsequently established the FCC through the Communications Act of 1934.
Congress has passed a number of additional statutes—some broad, some

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2025 Presidential Transition Project

narrow—that pertain to the FCC’s authority, including most significantly
the Telecommunications Act of 1996,”* which opened up markets for greater
competition and largely deregulated industry segments.

Technological change in the connectivity sector is occurring rapidly. We

are now seeing an unprecedented level of convergence, innovation, and
competition in the market for connectivity. On the one hand, traditional
cable providers like Charter are now offering mobile wireless services to
consumers in direct competition with traditional wireless companies like
Verizon. On the other hand, a new generation of low-earth orbit satellite
services like StarLink and Amazon’s Project Kuiper stand to offer high-
speed home broadband in competition with legacy providers. Furthermore,
broadcasters are offering high-speed downloads directly to consumers over
spectrum that previously provided only TV service.

These rapidly evolving market conditions counsel in favor of eliminating
many of the heavy-handed FCC regulations that were adopted in an era
when every technology operated in a silo. These include many of the FCC’s
media ownership rules, which can have the effect of restricting investment
and competition because those regulations assume a far more limited set of
competitors for advertising dollars than exist today, as well as its universal
service requirements.

Ultimately, FCC reliance on competition and innovation is vital if the
agency is to deliver optimal outcomes for the American public. The

FCC should engage in a serious top-to-bottom review of its regulations

and take steps to rescind any that are overly cumbersome or outdated.

The Commission should focus its efforts on creating a market-friendly
regulatory environment that fosters innovation and competition froma
wide range of actors, including cable-based, broadband-based, and satellite-
based Internet providers.

AUTHOR’S NOTE: [he preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume. While this
chapter identifies certain issues on which the contributors did not all agree, the author alone assumes responsibility
for the content of this chapter, and no views expressed herein should be attributed to any other individual.

— 857 —

Mandate for Leadership: The Conservative Promise

ENDNOTES

CON! Sr OTe Os Nor

10.
iA,

16.
17.

18.

19.

20.

Ibid.
47 USC. § 154(0).

47 U.S.C. § 155(a),
Ibid.
Ibid.
exis
wou
The
agai

There are no
ing Commissi
d impose lim
question is no
nst removal in
Communication
52 (1926)
Congress could im
significantly amen
at that time. Consi
independent coun
aware of remova
Chart, “FTES—His

s Act in

47 U.S.C. § 154(b)(5).
httos://www.law.cornell.edu/uscode/text/47/155 (accessed January 23, 2023).

oners. Fur
sonth
set
the
h

im
996, and Con
he high-profi

pose
ded i
derin

a
n
g

sels under the Independen

and protectio
nd Estimated,

S
a

powe
orica

it on the Preside

imits on the President's authority to designate a different Chairperson
her, though it is an open question, it is generally believed that the judiciary
e power of the President to remove a Commissioner during his
led because Congress did not include an express “for cause” or similar protection
Communications Act i
e years between the Supreme Court’s decision in Myers v. United States, 272 U.S.
and Humphrey’s Executor v. United States, 295 U.S. 602 (1935), when it was no
nt’s removal power. However, th

self. Scholars assume this

did not add “just cause” o
temporary debates about

gress
le con

ns for
Fisca

Years 1986-2023,” in U.S.

t Counsel Act, one could reason
presidentially appointed and Senate-confirmed officials.

47 U.S.C. § 151, https://www.law.cornell.edu/uscode/text/47/151 (accessed January 23, 2023).
47 U.S.C. § 154, httos://www.law.cornell.edu/uscode/text/47/154 (accessed January 23, 2023).

rom among the
or her five-year term.

is because Congress passed the

entirely clear that
e Communications Act was
r other protections from removal
the appointment and removal of
ably assume that Congress was

Federal Communications Commission,

2023 Budget Estimates to Congress, March 2022, p. 17, https://docs.fcc.gov/public/attachments/DOC-381693A1.

pdf (accessed Jan
U.S. Federal Com

Will Lapse Soon
roslyniay
will-
For a full listing o
U.S. Federal Com
organization
47 U.S.C. § 230, h
Thomas M. J

communica
This chap
ected handf
every con
lect a range
hnson, “The

U.S. Department of Co

for Rulemaking to

ntia.gov/fcc-filing/ntia-petition

January 23, 2023).

Malwarebytes, Inc. v. Enigma Software, 592 U.S.
certiorari), https://Awww.supren
See 47 U.S.C. § 230; see also Ray Baum’s Act of 2018,

municati

0n/2022/04/29/spectrum-au
apse-soon-if-congress-doesnt-act/?sh=4d32066908eb (accessed

al-charts-

ohnson Jr., “The FCC’s Auth
, 2020, https://www.fcc.gov/news-events/blog/2020/10/21/fecs-auth
ions-act (accessed Jan
er does not purport to set forth a comprehensive agenda for the FCC. Rather, it focuses on a
may quickly rise to the attention o
is chapter agrees with every policy idea inc
of views and perspectives.

FCC’s Authority

ul of iss
tributor to th

uary 23, 2023).

Congress Doesn't Ac

the FCC’s Bureaus an

munications Commissi

cc (accessed Jan
tos://www.law.cornel

ctions-have-raised-230-billion-

d Offices, along with their funct
on, “Organizational Charts of th
uary 23, 2023).

uary
e areas tha
0 Interp

mmerce, Nationa
Clarify Provision

s of Section 230 o
-rulemaking-clarify-provisions-secti

necourt.gov/opinions/20pdf/19-1284_|

ority to Interpret Section 230 0

23, 2023).

uded

ret Section 230 of the Com
| Telecommunications and
the Commun

mun

ica

Division P. Ti

Reporting Act), in H.R. 1625, Consolidated Appropriations Act, 2018, Pu

Congress, March 23, 2018, https://www.congress.gov/

January 23, 2023).

NetChoice, L.L.C. v. Paxton, 49 F.4th 439 (5th Cir. 2022), https://fingfx.th
gdpzqyobyvw/alisonn%201.pdf (accessed January 23, 2023).

— 858 —

2020) (Thomas, J., statement respecting
869d.pdf (accessed January 23, 2023).
el,

ons Commission, 2025 Budget Estimates to Congress, p. 7.
Roslyn Layton, “Spectrum Auctions Have Raised $230 Billion; The FCC’s Auth
,” Forbes, April 29, 2022, https://www.forbes.com/sites/

ority to Conduct Them

he-fccs-authority-to-conduct-them-
January 23, 2023).

ions and an organization chart, see

e FCC,” https://www.fcc.gov/about-fec/

edu/uscode/text/47/230 (accessed January 23, 2023).

the Communications Act,” October

ority-interpret-section-230-

anew Administration. Similarly, not
here; this document attempts to

ications Act.”

nformation Administration, “NTIA Petition
ions Act,” July 27, 2020, https://
on-250-communications-act (accessed

he denial of

§ 401 (codifying the Consolidated
blic Law No. 115-141, 115th

15/plaws/publ141/PLAW-115publ141.pdf (accessed

omsonreuters.com/gfx/legaldocs/

21.

22.

23.

24.

25.

26.

27.

28.

2025 Presidential Transition Project

Hal J. Singer and Ted Tatos, Subsidizing Universal Broadband Through a Digital Advertising Services Fee: An
n One, September 2021, p. 1 (“[T]he current USF mechanism is unsustainable and

Alignment of Incentives, Eco
will fail to meet the needs o

wp-content/uploads/2021/09/Digital-Divi
FBI Director Christopher Wray, testimony i
on Homeland Security, U.S. House of Repr
homeland.house.gov/activiti

23, 2023); John D. McKinnon

U.S. Federal Communication
Secure Networks Act,” upda
January 23, 2023).

H.R. 820, Foreign Adversary
httos://www.congress.gov/1
U.S. Department of State, “T

U.S. Government Accountab

January 23, 2023).

com/articles/tiktok-national-security-dea
(accessed January 23, 2023).
s Commission, “List of Equipment and Services Covered by Section 2 of the

ed September 20, 2022, https://www.fcc.gov/supplychain/coveredlist (accessed

— 859 —

its target consumer base within the next five years.”), https://www.econone.com/
de-HSinger-TTatos-2.pdf (accessed January 23, 2023).
n video of hearing, Worldwide Threats to the Homeland, Committee
esentatives, November 15, 2022, at 02:27, https://democrats-
es/hearings/11/04/2022/worldwide-threats-to-the-homeland (accessed January
, Arunav Viswanatha, and Stu Woo, “TikTok National-Security Deal Faces More
Delays as Worry Grows Over Risks,” The Wall Street Journal, updated December 6, 2022, https://www.wsj.
-faces-more-delays-as-worry-grows-over-risks-11670342800

Communications Transparency Act, 118th Congress, introduced February 2, 2023,
8/bills/hr820/BILLS-118hr820ih.pdf (accessed March 6, 2023).

he Clean Network,” https://2017-2021.state.gov/the-clean-network/index.html
(accessed January 23, 2023).
ility Office, Broadband: National Strategy Needed to Guide Federal Efforts to
Reduce Digital Divide, GAO-22-104611, May 2022, https://www.gao.gov/assets/gao-22-

O46ll.pdf (accessed

Document No. 144, “Federal Communications Commission: Message from the President of the United

States Recommending that Congress Create a New Agency to be Known as the Federal Communications
Commission,” U.S. Senate, 73rd Cong., 2nd Sess., February 26, 1934, https://docs.fcc.gov/public/attachments/
DOC-298207Al.pdf (accessed January 23, 2023).

47 U.S.C, Chapter 5, $$ 151 et seq., (accessed March 6, 2023).

FEDERAL
ELECTION
COMMISSION

Hans A. von Spakovsky

MISSION/OVERVIEW

The Federal Election Commission (FEC) is an independent federal agency that
began operations in 1975 to enforce the Federal Election Campaign Act (FECA)
passed by Congress in 1971 and amended in 1974.! FECA governs the raising and
spending of funds in all federal campaigns for Congress and the presidency. The
FEC has no authority over the administration of federal elections, which is per-
formed by state governments.

While the FEC has exclusive civil enforcement authority over FECA,’ the
U.S. Justice Department has criminal enforcement authority, which is defined
as a knowing and willful violation of the law.? Because the FEC is an independent
agency and not a division or office directly within the executive branch, the author-
ity of the President over the actions of the FEC is extremely limited.

As former FEC Commissioner Bradley Smith has said, the FEC’s “[r]egulation
of campaign finance deeply implicates First Amendment principles of free speech
and association.”* The FEC regulates in one of the most sensitive areas of the Bill of
Rights: political speech and political activity by citizens, candidates, political par-
ties, and the voluntary membership organizations that represent Americans who
share common views on a huge range of important and vital public policy issues.

NEEDED REFORMS

Nomination Authority. The President’s most significant power is the appoint-
ment of the six commissioners who govern the FEC, subject to confirmation by
the U.S. Senate. Commissioners may only serve a single term of six years but

— 861 —

Mandate for Leadership: The Conservative Promise

because they stay in office until a new commissioner has been confirmed, many
commissioners continue to serve past their terms.° Currently, the longest serv-
ing commissioner still at the FEC is Ellen Weintraub (D), whose regular term
expired in 2007.

Under FECA, no more than three commissioners may be from the same party.°®
While that means that a commissioner could be an independent or amember of the
Libertarian or Green Parties, in practice, this has meant that the FEC has always
had three Democrat and three Republican commissioners.’

There is a long-held political tradition since the FEC’s founding that when a
commission slot held by a member of the opposition political party opens up, the
President consults with, and nominates, the chosen nominee of the opposition
party’s leader in the Senate. In exchange, the Senate party leader and his caucus
agree to approve the President’s nominee to fill an empty position for the Presi-
dent’s political party. It has also been customary to advance the two nominees of
the differing political parties at the same time; this bipartisan pairing has histori-
cally permitted easy confirmation of both parties’ selectees.

Thus, by convention, a Republican President will nominate a Republican and
a Democrat for two open commission slots, including the choice of the Democrat
Senate leader for his party’s seat. In turn, the senator will direct his party to vote
to confirm both nominees. In the almost 50-year history of the FEC, this tradition
has only been broken once—when Senate Majority Leader Harry Reid refused to
approve one of George W. Bush’s nominees (Hans von Spakovsky) for a Republican
commission slot.®

In 2025, when a new President assumes Office, the term of five of the current
FEC commissioners will have either expired or be about to expire:?

e Shana M. Broussard (D)—April 30, 2023
e Sean J. Cooksey (R)—April 30, 2021
e Allen Dickerson (R)—April 30, 2025
e James Trainor, III (R)—April 30,2023
e =6Ellen L. Weintraub (D)—April 30, 2007
During their terms, the three Republican commissioners have demonstrated
with their votes and their public statements that they believe the FEC should not
overregulate political activity and act beyond its statutory authority, construe

ambiguous and confusing provisions against candidates and the public instead of
the government, and infringe on protected First Amendment activity.

— 862 —

2025 Presidential Transition Project

e The President assuming office in 2025 must ensure, if the three
Republican commissioners do not wish to remain on the FEC past
their terms, that nominees for these positions share the views of
those commissioners.

e Also, to the extent that the President has the ability to negotiate with
the Democratic Party leader in the Senate, he should try to temper
any choice of the opposition party to ensure that this individual does
not have extreme views on aggressive overenforcement that would
severely restrict political speech and protected party, campaign, and
associational activities.

U.S. Department of Justice/FEC-Related Activities. The President does
have control of the Department of Justice (DOJ). Thus, he has authority as Presi-
dent, primarily through his choice of attorney general and other political appointees,
to direct the prosecutorial functions of the DOJ regarding criminal enforcement of
FECA. Such investigations and prosecutions are carried out by the Public Integrity
Section of the Criminal Division, with the assistance, coordination, and help of the
Offices of U.S. Attorneys in whatever state an alleged violation occurs.

e The President must ensure that the DOJ, just like the FEC, is
directed to only prosecute clear violations of FECA. The department
must not construe ambiguous provisions against the public instead of
the government or apply FECA in a way that infringes on protected First
Amendment activity.

It should be but is not always obvious to overzealous government prosecutors
that if a federal law is confusing, it would be unjust to prosecute individuals who
are unable to determine if they are violating the law.

e The President should direct the DOJ and the attorney general not to
prosecute individuals under an interpretation of the law with which
the FEC—the expert agency designated by Congress to enforce the
law civilly and issue regulations establishing the standards under
which the law is applied—does not agree.

e Inmaking prosecution decisions, DOJ should be instructed to consult
and consider all official actions by the FEC that interpret the law
including prior enforcement actions, regulatory pronouncements,
and advisory opinions, just as private practitioners, the public, and
political actors must do.

— 863 —

Mandate for Leadership: The Conservative Promise

It is fundamentally unfair for the DOJ to prosecute an individual for supposedly
violating the law when the FEC has previously determined that a similarly situ-
ated individual has not violated the law. Furthermore, this rule should apply even
when there is a tied or three-to-three vote by the FEC commissioners whether in
an enforcement action or an advisory opinion since under the statute, the FEC
cannot take any action unless there are four affirmative votes.

Again, it seems obvious that if the commissioners designated by Congress to
interpret the law are unable to determine what the law requires, then it is unfair
to prosecute a citizen for violating that law. The DOJ should not engage in crim-
inal prosecutions that stretch legal theories and defy FEC interpretations and
regulations.

Another issue directly related to what has often been a contentious relationship
between the FEC and the DOJ is the conduct of litigation. The vast majority of
federal agencies are defended by the DOJ, which also represents them when the
agency is pursuing litigation as a plaintiff.

The FEC, however, is one of the few federal agencies with independent litigating
authority.!° The FEC’s lawyers represent the agency in federal court up through the
federal courts of appeal. Ifa case reaches the U.S. Supreme Court, then the Office
of the Solicitor General of the Justice Department represents the FEC.

In recent years, the FEC has failed to defend itself against litigation filed by
political allies of certain Democrat commissioners. It takes four votes to authorize
the general counsel of the FEC to defend a lawsuit filed against the agency, and
those commissioners have refused to provide that fourth vote, so “the public was
treated to the scandalous spectacle of the Commission—an independent agency
of the United States government—defaulting in litigation before federal courts.”"

These cases involved enforcement matters in which the commissioners dis-
agreed on whether a violation of the law had occurred. Accordingly, the final
votes of the commissioners did not approve moving forward with enforcement
because there were not four affirmative votes that a violation of the law occurred.
When private plaintiffs then sued the FEC for failing to take action, Democrat
commissioners refused to authorize the defense of the FEC in litigation as a
way of circumventing the prior final action of the FEC and the FECA four-vote
requirement to authorize an enforcement action. Such defaults in litigation are
unacceptable.

e The President should direct the attorney general to defend the
FEC in all litigation when there is a failure of the commissioners to
authorize the general counsel of the agency to defend it. No legislation
would be needed to accomplish this; the DOJ has the general authority to
defend the government and its agencies in all litigation.

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2025 Presidential Transition Project

e As alegislative matter and given this abuse, the President should
seriously consider recommending that Congress amend FECA to
remove the agency’s independent litigating authority and rely on the
Department of Justice to handle all litigation involving the FEC.

There are also multiple instances of existing statutory provisions of FECA and
the accompanying FEC regulations having been found unlawful or unconstitu-
tional by federal court decisions, yet those statutory provisions remain in the US.
Code and the implementing regulations remain in the Code of Federal Regula-
tions.” In such instances, those regulated by the law, from candidates to the public,
have no way of knowing (without engaging in extensive legal research) whether
particular statutory provisions and regulations are still applicable to their actions
in the political arena.

e The President should request that the commissioners on the FEC
prepare such guidance.

e Inthe event that the FEC fails to act, the President should direct
the attorney general to prepare a guidance document from the
Department of Justice for the public that outlines all of the FECA
statutory provisions and FEC regulations that have been changed,
amended, or voided by specific court decisions.

Legislative Changes. While a President’s ability to make any changes at an
independent agency like the FEC is limited," the President has the ability to make
legislative recommendations to Congress. One of the most obvious changes that
is needed is to end the current practice of allowing commissioners to remain as
serving commissioners long after their term has expired, defying the clear intent of
Congress in specifying that a commissioner can only serve a single term of six years.

e The President should prioritize nominations to the FEC once
commissioners reach the end of their terms and should be assisted
by legislative language either eliminating or limiting overstays to
a reasonable period of time to permit the vetting, nomination, and
confirmation of successors.

e The President should vigorously oppose all efforts, as proposed,
for example, in Section 6002 of the “For the People Act of 2021,”
to change the structure of the FEC to reduce the number of
commissioners from six to five or another odd number. The current
requirement of four votes to authorize an enforcement action, provide

— 865 —

Mandate for Leadership: The Conservative Promise

an advisory opinion, or issue regulations, ensures that there is bipartisan
agreement before any action is taken and protects against the FEC being
used as a political weapon.

With only five commissioners, three members of the same political party could
control the enforcement process of the agency, raising the potential of a powerful
federal agency enforcing the law on a partisan basis against the members of the
opposition political party. Efforts to impose a “nonpartisan” or so-called “inde-
pendent” chair are impractical; the chair will inevitably be aligned with his or her
appointing party, at least as a matter of perception.

There are numerous other changes that should be considered in FECA and
the FEC’s regulations. The overly restrictive limits on the ability of party com-
mittees to coordinate with their candidates, for example, violates associational
rights and unjustifiably interferes with the very purpose of political parties: to
elect their candidates.

e Raise contribution limits and index reporting requirements to
inflation. Contribution limits should generally be much higher, as they
hamstring candidates and parties while serving no practical anticorruption
purpose. And a wide range of reporting requirements have not been indexed
to inflation, clogging the public record and the FEC’s internal processes with
small-dollar information of little use to the public.

CONCLUSION

When taking any action related to the FEC, the President should keep in mind
that, as former FEC Chairman Bradley Smith says, the “greater problem at the
FEC has been overenforcement,” not underenforcement as some critics falsely
allege.’ As he correctly concludes, the FEC’s enforcement efforts “place a substan-
tial burden on small committees and campaigns, and are having a chilling effect
on some political speech...squeezing the life out of low level, volunteer politi-
cal activity.”"

Commissioners have a duty to enforce FECA in a fair, nonpartisan, objective
manner. But they must do so in a way that protects the First Amendment rights
of the public, political parties, and candidates to fully participate in the political
process. The President has the same duty to ensure that the Department of Justice
enforces the law in a similar manner.

— 866 —

2025 Presidential Transition Project

ENDNOTES

1. 52U.S.C. § 30101 et seg.
2. 52U.S.C. § 30106(b)(1).
3. 52U.S.C.§ 30109(¢) and (d).
4. Bradley A. Smith and Stephen M. Hoersting, “A Toothless Anaconda: Innovation, Impotence and
Overenforcement at the Federal Election Commission,” 1 Election Law Journal 2 (2002), p. 162.
5. 52US.C. § 30106(a)(2).
6. 52US.C. § 30106(a)(1).
7. Former Commissioner Steven Walther (2006-2022) was listed nominally as an independent but he was
recommended to President George W. Bush for nomination by former Nevada Sen. Harry Reid (D) and almost
always voted in line with the Democrat commissioners on the FEC.
8. Hans von Spakovsky served as a commissioner from 2006 to 2007 in a recess appointment. While no other
nominee has been rejected by the Senate, the tradition of bipartisan voice vote confirmation has largely
ended. Two Republican nominees—Allen Dickerson and Sean Cooksey—were confirmed on party-line votes
in 2020. And one Democrat—Dara Lindenbaum—was confirmed with the support of only six Republican
senators in 2022.
9. The term of the 6th Commissioner, Dara Lindenbaum (D), will expire on April 30, 2027.
10. 52U.S.C. § 30107(a)(6).
11. “Statement of Chairman Allen J. Dickerson and Commissioners Sean J. Cooksey and James E. ‘Trey’ Trainor,
|| Regarding Concluded Enforcement Matters,” Federal Election Commission (May 13, 2022), https://www.
ec.gov/resources/cms-content/documents/Redacted Statement Regarding Concluded Matters 13
ay_2022 Redacted.pdf.
12. See, eg., McCutcheon v. Federal Election Commission, 572 U.S. 185 (2014).
13. It should be noted, however, that the constitutional authority of a President to, among other things, remove
appointees and direct the actions of independent agencies is a hotly contested and increasingly litigated issue.
See Free Enterprise Fund v. Public Company Accounting Oversight Board, 561 U.S. 477 (2010); Seila Law LLC v.
Consumer Financial Protection Bureau, 140 S. Ct. 2183 (2020); and Collins v. Yellen, 141 S. Ct. 1761 (2021).
14. HR.1, 117th Cong. (2021-2022).
15. Bradley A. Smith and Stephen M. Hoersting, “A Toothless Anaconda: Innovation, Impotence and
Overenforcement at the Federal Election Commission,” 1 Election Law Journal 2 (2002), p. 171.
16. ld.

— 867 —

FEDERAL TRADE
COMMISSION
Adam Candeub

MISSION/OVERVIEW

America’s antitrust laws are over a century old. In 1890, the U.S. Congress
enacted the Sherman Act,' the first federal prohibition on trusts and restraints of
trade. The Clayton Act,’ adopted in 1914, builds upon the Sherman Act, outlawing
certain practices, such as price fixing, while bringing other business combinations,
such as mergers and acquisitions, under regulatory scrutiny.

The Federal Trade Commission Act (FTCA),? also adopted in 1914, gives the
federal government legal tools to combat anticompetitive, unfair, and deceptive
practices in the marketplace, empowering the Federal Trade Commission (FTC) to
enforce provisions of the Sherman and Clayton Acts. The FTCA prohibits “unfair
methods of competition and unfair or deceptive acts or practices in or affecting
commerce.” Sections 8, 7, and 8 of the Clayton Act empower the FTC to block
unlawful tying contracts, unlawful corporate mergers and acquisitions, and inter-
locking directorates. Under an amendment to the FTCA, the Robinson—Patman
Act,* the FTC has authority to prohibit practices involving discriminatory pricing
and product promotion. While the FTC has enforcement or administrative respon-
sibilities under more than 70 laws, the FTCA and the Clayton Act are the focus of
its regulatory energy.

FTC actions, therefore, turn on the antitrust principles and market principles
it adopts. Modern approaches to antitrust stress that the objective of antitrust law
is to assure a competitive economy—which in economic terms maximizes both
allocative efficiency (optimal distribution of goods and services, taking into account
consumer’s preferences, so that prices tend toward marginal cost) and productive

— 869 —

Mandate for Leadership: The Conservative Promise

efficiency (using the least amount of resources for optimal output)—and thereby
maximizes consumer welfare.°

Recently, however, many in the conservative movement have taken a broader
view of antitrust. They point out that the authors of our antitrust laws did not
intend this purely economic understanding of competitive markets—and the
normative assumptions that undergird it—to guide their legislation. First, these
principles were only imperfectly worked out at the time the antitrust laws were
passed. Second, contemporaneous statements concerning the Sherman and Clay-
ton Acts demonstrate Congress’s concern about the political and economic power
of the oil and railroad trusts of the first Gilded Age, and their influence on dem-
ocratic institutions and civil society. Antitrust law can combat dominant firms’
baleful effects on democratic institutions such as free speech, the marketplace
of ideas, shareholder control, and managerial accountability as well as collusive
behavior with government.

Republican Senator John Sherman explained to Congress in support of his
eponymous legislation:

If we will not endure a king as a political power, we should not endure a
king over the production, transportation, and sale of any of the necessaries
of life. If we would not submit to an emperor, we should not submit to an
autocrat of trade, with power to prevent competition and to fix the price of
any commodity.°

Similarly, identifying the institutional threats that market concentration can
pose, the former Republican President and future Supreme Court Justice William
Howard Taft wrote at the time,

The federal antitrust law is one of the most important statutes ever passed

in this country. It was a step taken by Congress to meet what the public had
found to bea growing and intolerable evil in combinations between many
who had capital employed in a branch of trade, industry, or transportation, to
obtain control of it, regulate prices, and make unlimited profit.

Taft saw in this economic threat broader implications for American society
since “the building of great and powerful corporations which had, many of them,
intervened in politics and through use of corrupt machines and bosses threatened
us with a plutocracy.””

Others in the conservative movement have maintained for numerous decades
that an economic justification is the only coherent approach to the antitrust laws.
Many view the first 90 years of U.S. antitrust policy as unprincipled in its approach,
often resulting in policies that, by trying to protect smaller competitors, ended up

— 870 —

2025 Presidential Transition Project

raising prices for consumers. Judge Robert Bork in his influential book The Anti-
trust Paradox found economic justifications for previously denounced behavior
including small horizontal mergers, all vertical and conglomerate mergers, vertical
price maintenance and market division agreements, tying arrangements, exclusive
dealings and requirements contracts, “predatory” price cutting, and price “discrim-
ination.” Bork also defended corporate “bigness” if it came about through internal
growth or acceptable mergers. He also defended agreements between competitors
on prices, territories, refusals to deal, and other “suppressions of rivalry” that are
“ancillary” to some economic efficiency. The practical contribution of his work was

to put consumer welfare at the heart of competition law.®

Beyond antitrust injury, we are witnessing in today’s markets the use of eco-
nomic power—often market and perhaps even monopoly power—to undermine
democratic institutions and civil society. Practices such as Environmental, Social,
and Governance (ESG) requirements on publicly traded corporations and their
inclusion in business agreements, the so-called “de-banking” of industries and
individuals, and the interference of large internet firms with democratic political
discourse undermine liberal democracy, a truly open society, and, indeed, rule of
law. Without rule of law, markets themselves will wither.’

Critical of the “social responsibility” agenda, Milton Friedman in his provoc-
atively titled essay “The Social Responsibility of Business Is to Increase Its
Profits” states,

[T]here is one and only one social responsibility of business—to use its
resources and engage in activities designed to increase its profits so long
as it stays in the rules of the game, which is to say, engages in open and free

competition, without deception or fraud.'®

For Friedman, market mechanisms, not political mechanisms, are the appropri-
ate way to determine the allocation of scarce resources to alternative uses. Business
managers appropriate shareholder wealth when they use corporate resources to
further their personal political beliefs, even when pursuing what they consider
a “socially responsible” or “moral” agenda. The business of American business is
business, not ideology.

More broadly, there is less and less debate around the growth of monopoly rents
throughout the U.S. economy. The current data strongly suggest that U.S. corpo-
rations are systematically earning far higher profits than they were 25 or 30 years
ago. Combined with other evidence that large corporations are accounting for an
increasing share of revenue and employment, it certainly appears that many large
U.S. corporations are earning substantial incumbency rents, and have been doing
so for at least 15 years, apart from during the depths of the Great Recession that
began in 2008.

— 871—

Mandate for Leadership: The Conservative Promise

While the explanations for this shift are not clear, what is particularly disturbing
is the possibility that these rents are extracted at least in part through regulatory
capture—which can function as a bar to entrance for new competitors. In addition,
the sheer cost of compliance with regulation favors large firms, which can more
efficiently spread the cost of regulation over a larger revenue base and have the
resources to invest in sophisticated government relations. The FTC must consider,
therefore, the role of government itself in maintaining market concentration in
areas ranging from pharmaceuticals and healthcare to avionics, banking, and real
estate brokerage.

Beyond undermining small businesses and reducing their salubrious moral
effect on American civil society, concentration of economic power facilitates col-
lusion between government and private actors, undermining the rule of law. The
continued emergence of evidence documenting collusion—between the Big Tech
internet platforms and the Biden White House and administrative agencies—to
censor criticism, scientific fact, and uncomfortable political truths demonstrates
this unfortunate development.

But, there are some caveats. First, the FTC lacks the power to revisit developments
in antitrust laws, which have brought an invaluable rigor to the antitrust law—mat-
ters such as analyzing vertical integration, for example. Nor should it. Second, the
FTC’s recent rescinding of its 2015 Policy Statement was undoubtedly ill-consid-
ered." Of course, the consumer welfare standard must guide FTC action, but, in
appropriate situations and with strong evidence, this standard must be expanded
to include more factors than just price. Further, a similar standard of proof used to
establish that a practice challenged by the Commission causes harm to competition
must also apply in demonstrating the efficiencies that justify the practices.

President Harry Truman reportedly made the famous quip, “Give me a one-
handed economist. All my economists say ‘on the one hand...’, then ‘but on the
other.” When it comes to some of the more vexing issues in antitrust regulation,
the conservative movement is in the same predicament. Many wish to preserve the
productivity and efficiency focus of an economic-based consumer welfare standard
approach to antitrust enforcements; others are more willing to look at the effects
of business concentration in certain industries on innovation, the institutional
resilience of our democracy, and children’s development. The following discussion
sets forth policy principles and initiatives on which there was agreement among
the contributors to this chapter, and notes and explains where there was dissent.

NEEDED REFORMS

Should the FTC Enforce Antitrust—or Even Continue to Exist? Some
conservatives think that antitrust enforcement should be invested solely in the
Department of Justice (DOJ). The FTC’s commissioners are not removable at will
by the President, which many quite reasonably believe violates the Vesting Clause

— 872 —

2025 Presidential Transition Project

of Article II of the Constitution; it is for this reason that conservatives have long
believed in either ending law enforcement activities of independent agencies or
ending their independent status. The Supreme Court ruling in Humphrey’s Execu-
tor upholding agency independence seems ripe for revisiting—and perhaps sooner
than later.’

Others think that the post-New Deal expansion of the administrative state
has had baleful effects upon our society and earnestly share the hope that it can
be greatly curtailed if not eliminated—or that its authority can be returned to the
states and other democratically accountable political institutions. But, until there
is areturn to a constitutional structure that the Founding Fathers would have rec-
ognized and a massive shrinking of the administrative state, conservatives cannot
unilaterally disarm and fail to use the power of government to further a conserva-
tive agenda. As experience shows, the administrative state will grow and further
its own agenda, often at odds with conservative thought, even under conservative
leadership. Unless conservatives take a firm hand to the bureaucracy and marshal
its power to defend a freedom-promoting agenda, nothing will stop the bureaucra-
cy’s anti-free market, leftist march.

ESG Practices as a Cover for Anticompetitive Activity and Possible
Unfair Trade Practices. It has long been suspected, and is now increasingly
documented, that corporate social advocacy on issues ranging from “Diversity,
Equity, and Inclusion” (DED to the “environmental, social, and governance”
(ESG) movement also serves to launder corporate reputation and perhaps obtain
favorable treatment from government actors. In a recent Senate Judiciary hear-
ing, Senator Josh Hawley asked FTC Chair Lina Khan if the FTC had conditioned
merger reviews on ESG or critical race theories adopted by the firms involved.
Khan responded by saying that she turned down deals when firms offered social
justice policies in return for approving unlawful deals. In response to a similar
question from Senator Tom Cotton, Khan responded that firms try to come to the
FTC to get out of antitrust liability by offering climate, diversity, or other forms of
ESG-type offerings, but that there is no ESG loophole in the antitrust laws.”

Her comments suggest that there is a movement of firms attempting to use
both ESG and DEI as a sort of reputational laundering to avoid enforcement of
potentially criminal activity. The FTC should set up an ESG/DEI collusion task
force to investigate firms—particularly in private equity—to see if they are using
the practice as a means to meet targets, fix prices, or reduce output.

e Congress should investigate ESG practices as a cover for
anticompetitive activity and possible unfair trade practices.

The business of American business is business, not ideology. The privileges
extended to corporations in American society come with the expectation that

— 873 —

Mandate for Leadership: The Conservative Promise

they will pursue profits for shareholders, bringing about economic growth.
Managers, particularly in publicly traded corporations, who use their power to
advance sets of fashionable moral beliefs, such as ESG/DEI, introduce agency
problems into the shareholder relationship and appropriate corporate wealth
for their own benefit.

Milton Friedman recognized this problem decades ago when answering the
question whether businesses have ethical or social obligations, as was mentioned
above. Contrary to his detractors, Friedman did not defend “greed is good.” Rather,
according to Friedman, socially responsible activities conducted by a corporation
distort economic freedom because shareholders do not decide how their money
will be spent—increasing the possibility for fraud or management opportunism.
This is especially the case in concentrated industries with market power.”®

Managers who insert their own values into underwriting agreements, contracts
for professional services, or other business transactions coopt shareholder value
for their own personal utility. This is an unfair trade practice, particularly when it
occurs in industries that enjoy market power and special privileges or relationships
with the government.

Cancel Culture, Collusion, and Commerce. As a corollary, businesses that
make general offers of service to the public forego profits by refusing to service
a lawful activity, i.e., fossil fuel extraction or gun manufacturing, raising similar
concerns. When banks or internet platforms refuse customers based on their
political or social views (as distinguished from religious views), they forgo profits.
While such decisions are often justified on public relations, marketing, or branding
grounds—and normally such decisions, reflecting business judgment, should and
would receive deference, this presumption is harder to make in a highly parti-
san, ideologically divided America. This type of behavior can rise to the level of an
unfair trade practice when the business is (1) publicly traded; (2) highly regulated;
(3) enjoys legal privileges; (4) enjoys market power; and (5) appears to engage in
its own political or social agenda that is unrelated to any conceivable branding
concerns. The government, as guided by democratically passed laws, already reg-
ulates activities such as fossil fuel extraction and gun manufacturing. Businesses,
particularly those that enjoy certain government privileges or relationships and/
or market power, should not replace democratic decision-making with their own
judgment on controversial matters.

A related concern is the degree to which concentration of industries, particu-
larly in pharmaceuticals, health care, and the internet, encourages government
collusion that undermines democratic institutions. Collusion can be explicit, in the
case for example of government working with social media companies to censor
politically harmful news, or more implicit—for example, regulatory requirements
so burdensome that they deter market entrance by smaller entities without the
resources to bear them.

— 874 —

2025 Presidential Transition Project

Protecting Children Online. The FTC has long protected children in a variety
of different contexts. Internet platforms profit from obtaining information from
children without parents’ knowledge or consent—and social media’s effect on the
well-being of American children is well-documented. Around 2012, American
teens experienced a dramatic decline in wellness. Depression, self-harm, suicide
attempts, and suicide all increased sharply among U.S. adolescents between 2011
and 2019,'° with similar trends worldwide.” The increase occurred at the same
time that social media use moved from rare to ubiquitous among teens,’* making
social media a prime suspect for the sudden rise in mental health issues among
teens. In addition, excessive social media use is strongly linked to mental health
issues among individuals. Several studies strongly support the notion that social
media use is a cause, not just a correlation, of subjective well-being and poor
mental health.”

Social media and other large platforms form millions of contracts every year
with American children. And even though a minor can void most contracts into
which he or she enters, most jurisdictions have laws that hold minors accountable
for the benefits received under the contract. Thus, children can make enforceable
contracts for which parents could end up bearing responsibility. Targeting chil-
dren to create potentially harmful contracts or making parents responsible for
such contractual relationships is an unfair trade practice. The FTC, therefore, has
the authority, interest, and duty to protect children online from such contractual
relationships.

e The FTC should examine platforms’ advertising and contract-
making with children as a deceptive or unfair trade practice, perhaps
requiring written parental consent.

Currently, the Child Online Privacy Protection Act (COPPA) regulates the
information internet firms can obtain from children. COPPA fails because it (1)
only protects children under the age of 13, leaving older teenagers completely
unprotected and (2) only prohibits platforms from collecting information froma
child using “actual knowledge” rather than abiding by the “constructive knowledge”
standard, which prohibits collecting information from a user reasonably assumed
to be underage. The FTC has rulemaking authority under this statute but has done
little with this authority, nor can it—given the statutory constraints. However,

e The FTC can and should institute unfair trade practices proceedings
against entities that enter into contracts with children without
parental consent. Personal parental responsibility is, of course, key, but
the law must respect, not undermine, lawful parental authority.

— 875 —

Mandate for Leadership: The Conservative Promise

Other conservatives are more skeptical concerning the effect of online expe-
rience on the young, comparing the concern about social media to concern about
video games, television, and bicycle safety. They point out, as does Cato fellow
Jeffrey A. Singer, that the psychiatric profession has yet to designate “internet
addiction” or “social media addiction” as a mental disorder in the authoritative
Diagnostic and Statistical Manual of Mental Disorders (DSM-5-TR).” These con-
servatives also maintain that calling for regulation undermines conservatives’ calls
for parental empowerment on education or vaccines as well as personal parenting
responsibility.

In addition, some of the methods used to regulate children’s internet access
pose the risk of unintended harms. For instance, age verification regulations would
inevitably increase the amount of data collection involved, increasing privacy con-
cerns. Users would have to submit to platforms proof of their age, which raises
the risks of data breach or illegitimate data usage by the platforms or bad actors.
Limited-government conservatives would prefer the FTC play an educational role
instead. That might include best practices or educational programs to empower
parents online.

Antitrust Enforcement. As is evidenced by a relentless focus on bringing Big
Tech lawsuits, state attorneys general (AGs) are far more responsive to their con-
stituents than is the FTC. Such a “boots on the ground” approach would benefit
the FTC enormously. Practically, this would mean establishing a distinct role in
the FTC Chairman’s office focused on state AG cooperation and inviting state AGs
to Washington, D.C., to discuss enforcement policy in key sectors under the FTC’s
jurisdiction: Big Tech, hospital mergers, supermarket mergers, and so forth.

FTC regional offices are substantially more in touch with local issues. Over the
past few decades, the reach and influence of regional offices has shrunk dramati-
cally. The FTC should consider returning authority to these offices.

Some conservatives however are less supportive of this idea. Conservative
enthusiasm for the idea of adding regional FTC offices to the states is a break from
the majority conservative position. Endorsing the federal government as a pre-
mier job creator runs counter to decades of conservative opinion that holds that
New Deal agencies and subsequent government bodies should never have been
created in the first place, and that their red tape and interference is a dominant
cause of economic inefficiency. Republicans used to seethe when Democrats tried
to move federal offices into the states. In the early 1990s, House Minority Whip
Newt Gingrich fumed about Senator Robert Byrd’s campaign to transfer certain
national intelligence facilities to West Virginia, calling it a “pure abuse of power.”

Some contributors to this chapter would remind conservatives that the unseen
mechanics of redistribution—by which taxpayer money paid to state employees is
taken from taxpayers nationwide—is a drag on the economy of the entire country.
Many conservatives fear that it would be impossible to uproot or even prune back

— 876 —

2025 Presidential Transition Project

a bureaucracy the seeds of which have been planted in every state. State legislators
would struggle to slash funding from agencies that employ and generously pay
thousands of their constituents. FTC outposts would tie middle America inex-
tricably to big progressive government, remaking the heartland in Washington’s
image. It would be anything but decentralization; Americans need policy makers
to discipline the arrogance that prevails inside the Beltway, not spread it. It would
be “Swamp 2.0”: just as deep and many times as wide.

Big Tech and Antitrust. The large internet platforms have transformed the
U.S. economy, streamlining consumer purchases, networking billions of people,
and altering long-established business practices. Despite their enormous size, they
have avoided significant antitrust liability or prosecution. The reasons for this are
not entirely clear.

It may be because these platforms have been incredibly innovative and have
generated tremendous efficiencies for our society, with little to no evidence of
traditional consumer harm in the form of higher prices, reduced output, or a lack of
innovation. Also, Americans report a high level of satisfaction in and trust regard-
ing these companies.

The less friendly regulatory environment in the European Union would make
a good case study in expansive antitrust law. The continent boasts not one of the
top 10 global tech companies, while the U.S. can claim eight.” Some claim that
the recent drop in value of former leader and current antitrust target Meta, along
with the rise of new competitors such as Zoom and Chinese-dominated TikTok,
indicates that competitive forces are healthy and at work benefiting consumers
in the tech space.

On the other hand, the platforms challenge traditional economic thinking
because arguably the firm structure they employ is radically different, and they
create different competition dynamics. First, there is some evidence that the major
internet platforms have market power, resulting in increased prices for advertis-
ers, costs that very well could be passed onto consumers. For instance, numerous
government studies have found evidence of market power.”* And while some data
show declining advertising costs, they also show increasing prices in this decade.**

Second, while consumers may report that they like social media, hedonics tells
a different story, suggesting that social media and other online activities diminish
human happiness. This evidence, while mixed at first,?°> appears to have become
quite solid: Social media makes Americans less happy.”°

Third, internet platforms have not created consumer price increases, but of
course they provide free services—and this creates a challenge for antitrust regu-
lation. For decades, antitrust economics has been focused on a paradigm in which
firm and consumer behavior are modeled as functions of price and output as the
primary variables. It may very well be that these models do not fully capture the
effect of technologies that enable increasing returns to scale based on data, such

— 877 —

Mandate for Leadership: The Conservative Promise

as digital platforms. This possibility cannot be lightly discounted, considering the
tremendous market power of these firms and their market cap, with the top five
firms of the U.S. market (Apple, Microsoft, Amazon, Tesla, and Alphabet) responsi-
ble for 23.5 percent of the market cap of the S&P 500 index in early December 2021.

The questionable predictive power of traditional economic theory was illus-
trated when, after a much-heralded investigation, antitrust regulators appointed
by former President Barack Obama declined to sue Google in January 2013 for
anticompetitive behavior. The FTC spent 19 months investigating Google over
allegations that the search giant was violating antitrust laws by favoring its own
products over those of rival content providers, including eBay, Yelp, TripAdvisor,
Facebook, and Amazon. The probe focused on Google’s control over online search
and search advertising, as well as the company’s growing dominance in mobile
phone software.

According to documents uncovered in press reports,”” the FTC’s economists
successfully argued against initiating antitrust action against the company. This
decision was based in large part on a series of predictions that the agency’s staff eco-
nomic experts made. These predictions turned out to be wrong in several respects.
For instance, according to press accounts, these economic experts saw only “lim-
ited potential for growth” in ads that track users across the web—now the backbone
of Google parent company Alphabet’s $182.5 billion in annual revenue. Relying on
theory, the experts downplayed the importance of mobile search, believing that
search would continue to be conducted primarily on desktop computers—and
thereby underestimating the effect of Google on Android systems. The experts
predicted that Microsoft, Mozilla, or Amazon would offer viable competition to
Google in mobile search. This decision, of course, occurred in a political environ-
ment of close relationships between the Obama Administration and Silicon Valley.

Just as traditional economic theory seems inadequate to the job of understand-
ing Big Tech and predicting its behavior, empirical evidence is very difficult to
come by. This is particularly troublesome. Beyond the fact that most user data
are proprietary, online markets change so quickly that econometric conclusions
are often difficult to make because even if the data are available, they do not exist
for long enough time horizons. Yet, a pattern of highly concentrated firms—with
occasional dropout and replacement by another successor firm with vast market
power—seems to be emerging.

The policy implications of this quandary are not clear, but for the conservative
movement, some believe that some type of policy response is necessary. The domi-
nant internet platforms have disrupted democratic deliberation, as is evidenced by
the Hunter Biden laptop story. They have a propensity to collude with government
to advance political goals, as documents unearthed by the Missouri and Louisiana
AG suits concerning the COVID response demonstrate. And they play a pivotal
role in our economy.

— 878 —

2025 Presidential Transition Project

As Judge Frank Easterbrook famously suggested, regulators should look at the
cost of error in their judgments. This argument has usually been used to buttress
a tentative and hands off approach to antitrust because judicial error in antitrust
will persist (Type II error) and continue to damage markets, while failure to take
antitrust action (Type I error) will correct itself in the long run as competitors
challenge monopolies.”* However, failing to take antitrust enforcement action
(Type I error) includes the possibility of real injury to the structure of important
American institutions such as democratic accountability and free speech. If so, a
more proactive approach may be warranted.

Certain online services, such as social media, have an unquestionable negative
utility, particularly on young people, as set forth above. The more “efficient” pro-
vision of such services may create more unhappiness. More broadly, the utility
benefits of many online platforms and services are obscure and may be significantly
overstated, as the most recent evidence suggests.” The FTC must become more
sophisticated in measuring consumer surplus. In addition, the FTC should be open
to behavioral explanations, such as habit and small hedonic differences, as keys to
how platforms create and keep market power.*°

CONCLUSION

Conservative approaches to antitrust and consumer protection continue to
trust markets, not government, to give people what they want and provide the
prosperity and material resources Americans need for flourishing, productive,
and meaningful lives. At the same time, conservatives cannot be blind to certain
developments in the American economy that appear to make government-private
sector collusion more likely, threaten vital democratic institutions, such as free
speech, and threaten the happiness and mental well-being of many Americans,
particularly children. Many, but not all, conservatives believe that these develop-
ments may warrant the FTC’s making a careful recalibration of certain aspects of
antitrust and consumer protection law and enforcement.

AUTHOR’S NOTE: [he preparation of this chapter was a collective enterprise of individuals involved in the
2025 Presidential Transition Project. All contributors to this chapter are listed at the front of this volume, but Rachel
Bovard, John Ehrett, Christopher lacovella, Jessica Melugin, and Jon Schweppe deserve special mention. The author
alone assumes responsibility for the content of this chapter, and no views expressed herein should be attributed to
any other individual.

— 879 —

Mandate for Leadership: The Conservative Promise

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pp. 407-434.

881 —

ONWARD!

Edwin J. Feulner

he idea of Mandate for Leadership was first conceived in the fall of 1979

at a Heritage Foundation board of trustees meeting when former Trea-

sury Secretary Bill Simon and former General Services Administration
Administrator Jack Eckerd discussed the predicament they had faced when they
first joined anew, more conservative presidential Administration: They received
no practical plans on how to move their part of the federal bureaucracy to reflect
amore conservative policy direction other than vague exhortations to promote
free markets; smaller, more efficient government; and a stronger national defense.
In their new positions, they were briefed either by holdover appointees from the
former liberal Administration or by career civil servants who, inevitably, had a
vested interest in maintaining the status quo.

The discussion became quite animated as these Heritage board members
recalled transitioning to government positions from their former lives in the
private sector—moving their families, finding new homes, and uprooting their
children’s education while they assumed new responsibilities in a very different
environment.

Frank Shakespeare, who had headed the United States Information Agency
during the Cold War, noted that electoral politics is what gets a President and Vice
President elected and sent to Washington, but then policy politics is what they had
to focus on to do the right thing once they got the big job.

Former Navy Secretary and Ambassador Bill Middendorf added that there must
be a better way to prepare for real change in a more conservative direction in the
political environment in Washington. If a conservative candidate were to become

— 883 —

Mandate for Leadership: The Conservative Promise

the President-elect in just 16 months, what could be done by an outside group to
prepare for these new opportunities?

The staff at Heritage took this idea on as a challenge, and it would become the
defining policy decision in the early history of this upstart think tank. Task forces of
knowledgeable volunteers were formed with specific expertise in the whole range
of policy issues—from welfare reform to national defense reform.

The vision for Mandate for Leadership was that it would serve as a guidebook
of specific policy recommendations for reducing the size and scope of the federal
government and for ensuring that it stayed within its constitutional bounds. Pos-
itive plans for freeing the private sector from overblown government interference
and regulation could, we believed, result in an explosion of entrepreneurial activity
that would reassert America’s leading role in the world’s economy.

Thus, if conservatives finally gained control in Washington, they were prepared
to answer the question, “What is the conservative agenda?”

Candidate, then President-elect, then President Ronald Reagan’s “feisty new
kid on the conservative block—The Heritage Foundation”— had the answer, and
it was Mandate for Leadership.

First published in January 1981, the original Mandate served as a conservative
plan of action for the Reagan Administration, providing much of the blueprint for
the Reagan Revolution. It contained more than 2,000 detailed, actionable policy
recommendations to move the federal government in a conservative direction.

The recommendations ranged from internal bureaucratic reorganizations to
plans to implement specific, fundamental changes in every imaginable policy area—
from tax and regulatory reform to strengthening national defense to reforming
social programs. All were carefully crafted, vetted, and pieced together.

On January 21, 1981, at the first meeting of his Cabinet, President Reagan dis-
tributed copies of Mandate, and many of the study’s authors were recruited into
the Administration to implement its recommendations.

In the foreword of that first edition, I wrote, “What is offered by the authors
is a series of proposals which, if implemented, will help revitalize our economy,
strengthen our national security, and halt the centralization of power in the federal
government.”

The conservative movement had found in Ronald Reagan a President who
shared that vision and who had the will to go against the established political grain
in Washington. He also had the ability to speak directly to the American people and
convincingly show them how those ideas could work for the benefit of all.

Mandate’s proven ideas and President Reagan’s skill at communicating their
benefits led to his Administration implementing almost half of the reeommenda-
tions by the end of his first year in office.

Those recommendations led to tax cuts and other economic policies that
gave America one of the longest periods of peacetime economic growth in its

— 884 —

2025 Presidential Transition Project

history—with an annual growth rate that has not been rivaled since then. The rec-
ommendations led to a rebuilding of the United States military, helped to bring an
end to the Cold War and to the Soviet Union itself, and reinvigorated the Ameri-
can people with a collective sense of pride and patriotism that many thought had
vanished forever.

After that first edition, a new Mandate was produced every four years. But the
2016 edition was one of particular note. It earned significant attention from the
Trump Administration, as Heritage had accumulated a backlog of conservative
ideas that had been blocked by President Barack Obama and his team.

Soon after President Donald Trump was sworn in, his Administration began
to implement major parts of the 2016 Mandate. After his first year in office, the
Administration had implemented 64 percent of its policy recommendations.

As aresult of those recommendations, the Trump Administration cut taxes and
eliminated unnecessary regulations, creating a growing economy and the lowest
unemployment rate in five decades—including among minorities and women. It
made America a net energy exporter for the first time in half a century. It also
prioritized veterans’ care and rebuilt our national defenses.

As I noted above, in his first year in office, President Reagan implemented nearly
half of Mandate’s recommendations—an extraordinary feat. In 2018, in an inter-
view on Fox News, I mentioned that President Trump had implemented more
recommendations in his first year than Ronald Reagan did in his. Of course, at
the time, Reagan did not have both a Republican House and Senate as Trump did.
Nonetheless, President Trump liked being compared to a former President he
deeply admired, and he touted the comparison frequently.

This anecdote illustrates how Mandate provides a yardstick for conserva-
tive Presidents to measure their performance relative to one another. And, very
importantly, it allows the American people to see concrete evidence of the prog-
ress an Administration is making toward reversing the growth of government and
implementing conservative solutions in its stead. In essence, it allows the Amer-
ican people to hold their politicians accountable to the principles they profess
to believe in.

When we were producing that first Mandate edition, we had suffered under four
years of Jimmy Carter with double-digit inflation, double-digit interest rates, high
unemployment, gasoline rationing, weakness overseas, and what Carter himself
called a malaise that he had induced in the American people.

In the 1981 Mandate foreword, I wrote:

The full recovery of our nation in both the economic and foreign policy spheres
will require the sustained application of sound policies over several years. There
are no “quick fix” solutions to problems that have been years in the making. But
no time must be lost in taking the first decisive steps on the road to recovery.

— 885 —

Mandate for Leadership: The Conservative Promise

Today, President Joe Biden has brought us back to the days of Jimmy Carter—
actually, even worse—with full-bore economic, military, cultural, and foreign policy
turmoil. The advice that I wrote more than four decades ago just as easily could
have been written today. A conservative Administration coming on board in 2025
will need to hit the ground running just to undo the significant damage that will
have been done during the Biden years.

Something that is essential to ensuring that a new President in 2025 can suc-
cessfully implement a conservative agenda is having the right personnel to run the
executive branch departments and their agencies.

This is why it is so often said that “people are policy.” The Cabinet secretaries,
deputy secretaries, undersecretaries, assistant secretaries, deputy assistant secre-
taries, administrators, agency heads, and on and on that a new President chooses
to place throughout the executive branch must be principled individuals already
aligned with the President’s conservative vision. And they must be willing to exe-
cute it on the President’s behalf.

These personnel choices will ultimately determine the success or failure of the
policy agenda and, hence, of the whole Administration.

Presidential appointees not only are critical to implementing the policy agenda,
but also must serve to “watch the watchers” in the departments and agencies they
oversee. They must ensure accountability as well as provide a check on the inherent
nature of the administrative state to overreach its authority.

For example, they must rein in the Environmental Protection Agency, which
declared backyard streams navigable waterways that then fall under its author-
ity. They must rein in the Internal Revenue Service, including its 87,000 new
employees hired to pick through every detail of what Americans make and how
they spend their money. They must rein in agencies such as the Occupational
Safety and Health Administration, which the Biden Administration weapon-
ized to attempt to force COVID-19 vaccine mandates on 84 million Americans
through their workplaces.

When these new presidential appointees come into office, it is often the career
bureaucrats who end up orienting them to their new positions. Many of these
bureaucrats are all too comfortable with the status quo. Appointees have only four
years (eight at the most) to effect change and make a difference. They need a road
map to do that starting on Day One.

That road map is exactly what Mandate provides. It is not a mandate to main-
tain the status quo but just do it a little more efficiently. Rather, it is a mandate to
significantly advance conservative principles in practice and demonstrate to the
American people that where liberal policies generally fail, conservative solutions
succeed in making life better for all of us.

From the original 1981 Reagan-era Mandate for Leadership to this edition for
2025, the purpose remains the same: to present concrete proposals to revitalize

— 886 —

2025 Presidential Transition Project

our economy, strengthen our national security, and halt the centralization of power
in the federal government.

In Washington, there are no permanent victories. But neither are there per-
manent defeats. Rather, there are permanent battles throughout the policy arena.
The other side is never standing still. While we may achieve tremendous successes
under conservative leaders, the Left is always working to chip away at them, which
is why we must constantly be prepared for the next fight.

That’s why today, Heritage President Kevin Roberts, Project 2025 Director Paul
Dans, the whole Heritage team, more than 50 organizations, and more than 360
experts from throughout the conservative movement have come together to con-
tinue the Mandate for Leadership tradition of creating policy solutions to solve
the biggest issues facing America—solutions based on the core principles of free
enterprise, limited government, individual freedom, traditional American values,
and a strong national defense.

We do this not to expand government, grow its largesse for some special interest,
or centralize more control in Washington. Instead, we do this to build an America
where freedom, opportunity, prosperity, and civil society flourish for all.

One final note: As most readers know, this section of a book is usually called the

“Afterword,” but we have decided to title it “Onward!”

In all the decades that I served as The Heritage Foundation’s founder and
president—and to this day as a member of its Board of Trustees—I have ended
my communications with the exhortation “Onward!” This has been my charge to
encourage friends, colleagues, and allies that we must always be advancing. There
are always new battles and new opportunities ahead to challenge us to do even
more, and we must be ready for them, willing to engage, and use them to work for
the betterment of this nation and her people.

An afterword connotes finality, but “Onward!” signals that our next mission is
just beginning.

That is the message I leave you with today. Onward!

— 887 —

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